Daily Flows & Insights – Business Confidence Slumps

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.
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Curve Team
Jack Pedersen