Daily Flows

• 1-5 year Reference rates dropped slightly yesterday, however most of this retained throughout the afternoon.
• Levels are expected to be similar today with term deposit rates of 5.30% for 1 year and 5.20% for 5 year on offer.
• In the NCD space, market participants have been looking to smooth out maturity profiles and benefit from term premium. Outright NCD levels of 5.25% for 6 months and 5.05% for 1 year were locked in.

Employment Gradually Ticks in the Right Direction

• Yesterday Unemployment climbed to 4.1% in April from 3.9%.
• Full time employment decreased by -6.1K and part time jumped by 44.6 with the participation rate moving slightly to 66.7%.
• Whilst the monthly employment data has been quite volatile looking at long term trend it shows the labour market is gradually easing.
• This print suggests if the pace continues and the labour market continues to cool in the face of weakening demand it may fall inline with RBA forecasts for the year.