Daily Flows
- A 3-month rate of 5.05% offered by a non-fossil fuel ADI attracted significant flow yesterday.
- Today, Westpac has entered the market, launching a 5-year Fixed/Floating bond with initial guidance of 3-Month BBSW +88.
- 6-month NCDs are now being issued at rates between 4.89% and 4.94% by domestic issuers.
Global Bond Sell-Offs and ANZ Job Ads Rise
- In the UK and US, there has been a significant sell-off in bonds, pushing yields higher across the curve.
- A range of factors is contributing to this, primarily the large volume of bond issuance paired with reduced demand, monetary policy uncertainty, potential tariff implementation, and the perceived inflationary impact of Trump-era policies.
- This environment creates challenges for the RBA, as higher global yields could place additional downward pressure on the Australian dollar, contributing to imported inflation.
- Yesterday, the ANZ-Indeed Australian Job Ads index increased by 0.3% month-on-month for December, reversing recent declines.
- While Job Ads have been trending downward, they remain 14.7% above pre-pandemic levels.
- Looking ahead, further softening in employment growth is expected.