Daily Flows

• Yesterday, 1-year TD rates were offered at 4.65%. Today, that level may no longer be achievable, with 1-year swaps dropping 8 basis points following Trump’s tariff announcements.
• Semi-government floating lines saw strong demand yesterday, with high volumes traded in the QTC 2029s.
• With 6m BBSW remaining elevated, 6-month term deposits at 4.80% continue to offer attractive value today.

‘Liberation Day’ Kicks Off

• This morning, President Trump imposed a universal 10% tariff on all imports to the U.S., as part of a broader protectionist strategy, with higher tariffs on select countries.
• Targeted nations include the EU, Canada, Mexico, South Korea and Japan, all facing additional duties, particularly on vehicles and related components.
• While it’s too early to gauge the full impact, markets have reacted sharply—equities are under pressure, while bond yields have rallied on increased fears of a global economic slowdown.
• Increased volatility and uncertainty may drive stronger demand for safe-haven assets domestically. We’ve already seen Australian government bond yields tighten by 5–10 basis points across 1–5 year maturities.
• Going forward, the key question will be whether these tariffs are temporary or entrenched, and what the broader implications are for global growth and monetary policy settings.