Daily Flows
- We are still seeing plenty of demand semi FRNs with some stock still available across the curve out to the recent TCV 2031 issue.
- Any market participants able to place in the Unrated space have been rewarded handsomely, with levels 15 basis points above market offerings (3 month outright 5.25%, 6 month 5.35%).
- With liquidity sparse, NCD activity has been subdued. That being said flow is still happening at +55 for 3 months.
Business Confidence Slumps
- NAB Business Confidence index fell to -3 in May 2024, marking the lowest level in 6 months and venturing negative for the first time since last November.
- This negative print was driven by sectors such as manufacturing, transport and construction.
- Business conditions remained below average and sales declined to 10 from 13.
- Not much has changed from previous months, with conditions gradually trending lower and businesses remain cautious about the future.
- The data does not move the narrative too much, disinflation is still on its way, albeit at a gradual pace.
- The timing and pace of it will continue to be a key concern for the RBA going forward.