Daily Flows

• With subdued demand from the broader sector, ‘A’-rated larger banks continue to dominate the term deposit space, offering the most attractive rates in the market.
• That said, market participants looking for Non-Fossil Fuel counterparties can still enjoy top returns from AMP, BOQ, Bendigo and bespoke offerings.
• Today, Westpac launched a 5-year fixed and floating MTN with an initial price guidance of 3mBBSW +90.

Inflation Core Uptick Pushes Markets Away from 50 Basis Point Cut

• Yesterday, Trump and Harris debated in what was a feisty encounter, but it did little to move markets.
• On the other hand, U.S. CPI data was more noteworthy, with the core coming in slightly higher than expected at 0.3% MoM for August and the annual inflation rate at 2.5% YoY.
• While a 50 basis point cut from the Fed already seemed far-fetched, this higher-than-expected number effectively quashed expectations for such a cut at the next meeting. Money market traders are now pricing in a 28 basis point cut.
• Looking ahead, U.S. PPI data on Thursday is expected to print at 0.0% MoM, with subdued inflationary pressure in the pipeline contributing to the deceleration.