Daily Flows
- Foreign A1 names continue to attract inflows this week with a 6 month rate of 5.19% remaining the standout in the TD space while +50 remains the NCD margin.
- Investors have locked in longer-term deposits this week on the back of Tuesday’s RBA decision, which sparked falling yields across the curve.
- Today marks a good opportunity on the back of yesterday’s employment data, which sent rates briefly upwards again, to secure attractive levels on 3-5 year deposits before yields begin rallying.
Employment Data Surprises as Jobs Growth Soars
- Australian employment figures skyrocketed in February in data released yesterday, with the economy adding 116,500 new jobs, almost three times more than the 40,000 projected by economists.
- Unemployment fell from 4.1% in January to 3.7% in February, the biggest monthly change in nearly two years.
- Yields jumped across the curve, with the 3 year up 6bps on the day to over 3.70% and the 10 year almost touching 4.10% after starting the day at 4.05%. The Australian dollar was up as much as 0.4%.
- The data print challenges the narrative many bought on the back of the RBA’s Tuesday Statement of Monetary Policy that the economy is trending in the right direction on the back of the central bank’s hiking cycle.
- A first full rate cut is now not priced in until November, as traders pare back bets of an earlier cut.