Daily Flows

• Market participants who ventured into the unrated space were handsomely rewarded with a 5.05% return for 5-month term deposits.
• In the credit space, there has been decent liquidity in mutual paper, which is trading considerably wider than regional and major banks.
• NCD outright levels for 6 months are consistently being offered above 5.00%.

Safe Haven Trading & Strong ADP Jobs Data

• With growing uncertainty and geopolitical tensions in the Middle East, markets have returned to safe-haven trading.
• Much of the tightening from Treasury demand was unwound as a stronger-than-expected ADP employment number pushed out expectations for further monetary policy tightening.
• This comes ahead of the ISM survey and non-farm payrolls, both due at the end of the week.
• Markets will be watching both prints closely and interpreting them in the context of the monetary policy outlook.