Daily Flows & Insights – A Shorter Week Ahead for Australian Markets, US Eyeing Inflation

Daily Flows

  • Strong interest in the new A1/A+ ADI name at the 4 and 5 year tenors towards the end of last week is expected to continue, with a competitive additional option for those investors at limit with existing A-rated names.
  • ADIs in the A2/BBB+ space are paying competitive rates at the 9 month tenor, with more banks in this A2 space seeking funding this week.
  • Domestic A2 & A3 issuers can pay +45 over BBSW in some instances with foreign branch banks at up to +50.

A Shorter Week Ahead for Australian Markets, US Eyeing Inflation

  • A quiet Australia Day week ahead for domestic data releases with NAB’s business confidence data out on Wednesday.
  • Confidence has been steadily declining since the start of 2023, with Wednesday’s print likely to point to a continuation of this trend to kick off 2024.
  • Over the weekend markets pushed out the first RBA hike to November as expectations of rapid cuts ease.
  • The US Core PCE Price Index, the preferred inflation measure of the Fed, is out on Friday night Australian time, with forecast of an 0.2% increase MoM and 3.0% annually.
  • US markets still expect 6 full cuts by January 2025 with a first in May, but this Friday’s data release will be key in determining their speed on the back of Fed Governor Waller’s caution of slower cuts in statements released last week.
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Curve Team
Josiah Binet