Daily Flows & Insights – Prevailing Data Trends Sees a Balanced Response by Powell

Daily Flows

  • The peak in rates remains at the 12 month mark, with offerings upwards of 5.40% for term deposits.
  • In the NCD space, margins are dialling back to +45/+50 for 3 months as liquidity returns to the market.
  • We are still seeing offerings in the Semi FRN space, with volume available for TCV 2031.

Prevailing Data Trends Sees a Balanced Response by Powell

  • Overnight, Jerome Powell addressed law makers at a Congressional testimony where he confirmed there has been improvements in data.
  • Powell made it clear that inflation readings have shown progress and that labour market and demand is trending towards cooling.
  • Whilst he hinted at the good fortune this brings in the fight against inflation he also balanced this with the negative effects this cooling can have on the economy.
  • This balanced approach may signal that the Fed is on its way to cutting rates this year, an ethos that is certainly reflected in current market pricing.
  • In Australia, our position is a stark contrast. Our markets hold their breath for the next quarterly inflation print. Inflation that comes in hotter than the RBA’s forecasts may force Michelle Bullocks hand to raise to consider raising interest rates.
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Curve Team
Jack Pedersen