Daily Flows
- Following the long weekend, yesterday was notably active, with fresh opportunities emerging across both the TD and NCD curves.
- Today, several green-friendly BBB+ rated banks are in the market, with 1-year tenors offered around 4.25%, among the more attractive levels available.
- The spread between 3-month and 6-month BBSW has widened to 13bps, reflecting a steepening yield curve that presents value for income-focused investors.
Mixed Signals at Home, CPI Focus Abroad
- The Westpac–MI Consumer Sentiment Index rose 0.5% in June to 92.6, still well below the pre-Liberation Day level of 95.9. Employment expectations declined modestly, signalling caution in household sentiment.
- The NAB Business Survey showed mixed signals for May. Conditions eased to 0 (from +2), while confidence ticked up to +2 (from +1). Weak profitability and a new cycle low in the employment sub-index weighed on the overall read.
- Together, the soft consumer and business data point to a subdued economic outlook and strengthen the case for a more dovish RBA ahead of its July meeting.
- Attention turns to US May CPI tonight, with core inflation expected to rise 0.3% m/m (vs 0.2% prior), lifting the y/y rate to 2.9%. Markets are alert to potential tariff pass-through into prices.
