Daily Flows

• An A-2 rated bank is offering 4.45% for 6 months, but with Christmas now just 6 months away, many councils are locking in longer terms into early 2026 or opting for 12 months at 4.25%.
• Rabo Bank (A-1/A) continues to lead across the 2 to 5-year range, with top rates yesterday reaching 4.60%.
• Yield curve steepening continues, with a 15-point spread now between 3m and 6m BBSW, a shift worth watching for short-term pricing conditions.

Fed Holds as Outlook Remains Uncertain

• The US FOMC held rates steady at 4.25%–4.50% as expected, citing ongoing uncertainty from tariff effects and inflation dynamics.
• The updated ‘dot plot’ maintained expectations for two cuts in 2025, though seven members now forecast no cuts at all, up from four in March.
• US bond yields ended mostly flat after retracing intraday losses during Fed Chair Powell’s comments. The 10-year yield held at 4.39%, while the 2-year dipped to 3.94.
• In Australia, all eyes are on today’s May employment report. The consensus expects the unemployment rate to hold at 4.1%, offering a key read ahead the RBA next meeting on July 8.