Daily Flows
- Today marks a good opportunity for market participants with surplus cash to lock in healthy rates before slightly lower BBSW rates feed into pricing.
- Flows into several A2/BBB+ banks showing 5.40% for 12 months yesterday were matched by investors targeting the shorter end of the curve, where they could earn north of 5.00% for 3 months.
- Curve placed bids in yesterday’s Hollard Insurance subordinated notes issuance which proved to be particularly popular for investors targeting the subordinated space, and were able to secure good allocations for interested parties at a margin of 3mBBSW+360.
Optometrists Be Warned: Rose Coloured Glasses Needing an Increasingly Strong Tint
- Australia’s September GDP numbers were out yesterday, and even the most buoyant optimists had to squint to find anything to cheer about. QoQ growth came in at 0.2%, but, excluding population growth, that number dropped into the negatives (-0.5%).
- This print marks the third consecutive quarter of falling per capita GDP, a statistic not seen for 40 years and one that bodes ominously – it last happened during the recession of the early 1980s.
- All this serves as a good sign for those angling for an RBA cut in Q3 next year with markets indicating the central bank has done enough to curb inflation.
- In more positive news for the Australian consumer, oil continued on its merry way downward, with WTI below $70/barrel overnight at levels 25% lower than September. Relief at the petrol pump, perhaps?