Daily Flows & Insights – Gloomy Consumer Outlook for 2024

Daily Flows

  • Great Southern Bank’s 2.75 year medium term note yesterday priced at +160 over 3-month BBSW with a deal size of $300m.
  • Foreign branch banks were showing margins of +50 yesterday with pick-ups in yield available to investors willing to consider offshore names.
  • We saw opportunities pop up in the A2 and unrated space as small funding gaps were quickly filled. Market participants continued to hit a A1/A name showing above market rates, with 5.04% for 2 years attracting particular interest.

Gloomy Outlook for 2024 as Household Confidence Falls Further

  • Australian consumer confidence fell further in January as hopes of a boost in sentiment to kick off the new year were dealt a sharp reality check.
  • Consumer sentiment came in at 81 points in the Westpac index, down 1.3% on December with a reading in the bottom 7% of all observations since the index started in the mid-1970s.
  • Consumers identified rising mortgage repayments as the key factor driving hawkishness towards the state of the Australian economy amidst rising pessimism about general household finances as well as the economic outlook for the next 5 years more generally.
  • This latest data print, combined with aggregate declines in consumption of food, clothing, and toys in last week’s trade data; continues to paint a pessimistic picture of the Australian economy in 2024.
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Curve Team
Josiah Binet