Daily Flows

• Flows were mixed on Friday, with market participants enjoying higher outright term deposit rates off the back of rises in reference interest rates.
• Today, 1 year levels of 5.80% are being offered in the BBB space.
• NCD margins for 3 months have subdued a little, with +50 for 3 months the going rate for new funds.

Mixed Bag From U.S Payroll Data

• On Friday night, U.S. Non Farm Payrolls came in at 209K. This was weaker than the forecasted level if 250K.
• Average hourly earnings surpassed expectations at 0.4% MoM.
• This print is inline with its current downtrend excluding May (which can be attributed to seasonality).
• Hiring in the services sector has slowed with the hospitality and leisure leading this trend.
• This print was a mixed bag and may nor alter the Feds current outlook too much.
• The market is still leaning towards a hike next week with 22 basis points currently priced in.

The Week Ahead

• Domestically this week, Consumer Confidence and Business confidence is released.
• Mays business and consumer confidence prints had unexpected results, it will be interesting to see if this trend continues.
• On Wednesday Philip Lowe is addressing the Economic Society of Australia.
• This speech will focus on the changes that will be implemented on the RBA.
• Overseas, U.S. inflation data is released later in the week. This print will be watched closely ahead of next weeks Fed meeting.