Daily Flows

• Semi-government securities continue to see active trading, as balance sheet managers seek to acquire zero-risk-weight assets.
• Duration remains in focus, with most of middle market investors comfortable locking in above 4.50% term deposits for 3-5 years.
• Opportunities remain to secure +50 for 3-6 month NCDs from foreign branch banks.

Employment Falls in Australia

• Australia’s labour market weakened in February, with employment falling by 52.8k, reversing January’s downwardly revised 30.5k gain, while unemployment held steady at 4.1% due to a sharp drop in participation (-0.4ppts to 66.8%).
• Both full-time (-35.7k) and part-time (-17.0k) employment declined, while hours worked contracted by 0.4% m/m, reinforcing signs of softening labour market conditions.
• The data alone is not enough to prompt an immediate RBA rate cut, but it adds momentum toward easing monetary policy in the coming months.
• Despite weaker employment figures, the RBA remains cautious, with Deputy Governor Hauser recently emphasising strong employment growth—however, today’s data suggests that labour market conditions may be shifting to a more sustainable pace.