- Last Friday, considerable flow was directed to the ‘A’ rated space, with short term deposit offerings of 4.60%.
- Even with a flattening curve, market Participants are still being compensated for locking in longer term.
- Some investors were able to secure just under 5% for 2 year term deposits in the BBB space.
- Today, Bendigo Bank is launching 3 year fixed and floating medium term notes with initial price guidance of 3mBBSW +125-130 and S/Q ASW + 125-130 basis points.
RBA Quarterly Update Makes For Interesting Reading
- The RBA only made minor tweaks to their forecasts in Friday’s SOMP with but not enough to materially change the outlook.
- What was more interesting was the assumptions on which the forecasts were based on which we will take a deeper look at in our Monthly Insights later this week.
- While further RBA tightening from here remains data dependant, it seems only sticky inflation driven but the services sector will see any further action.
- It means that the next likely timing for a move will be in August following the full Q2 inflation data that is due the last week of July.
- For now, the market doesn’t have any further tightening priced in with a cut now full priced in for December which appears a bit ambitious at this point in time.