Daily Flows

• An A-1 short-term and A long term rated bank was offering 4.47% for 1-year the end of last week — 15–20bps above major bank levels, drawing strong investor demand.
• NCD flows have shifted toward foreign branches, where pricing remains firm at +50bps over 3-month BBSW, maintaining a premium to domestic issuance.
• With the RBA expected by many to cut rates tomorrow, opportunities remain today to lock in current pricing ahead of any potential repricing on the curve.

RBA Meet Tomorrow

• Moody’s downgraded the US sovereign credit rating to Aa1 from Aaa, citing concerns over rising government debt — aligning with S&P and Fitch, and sparking a mild sell-off in US Treasuries.
• The US 10-year Treasury yield rose 4bps to 4.48%, reversing some of last week’s gains as investors reassessed the long-term fiscal outlook.
• US consumer sentiment deteriorated further, with the University of Michigan index falling to 50.8 in May (vs. 53.4 expected), alongside a lift in inflation expectations.
• In Australia, the RBA meet on Tuesday, with a 25bp rate cut widely expected; the accompanying Statement on Monetary Policy will provide updated forecasts and context for the decision.