Daily Flows & Insights – The Week Ahead

Daily Market Update

  • Investors were on the lookout for semi-government fixed lines on Friday, snapping up short-dated lines in the QTC March and July 24s.
  • We saw activity in the secondary market for recent primary issuances, with the Heritage People’s Choice and Newcastle Greater FRNs attracting flows.
  • Term deposit rates were up slightly on Friday, with A1 names paying very competitive rates at the 12 month mark (5.15-5.18%), and big regional banks in the A2 space showing similar levels for 6-9 months.


The Week Ahead

  • A relatively quiet week ahead for central banks, with the main story the release of the Federal Open Market Committee on Tuesday following Monday’s US public holiday.
  • Last week’s stronger-than-expected prints for consumer and producer prices showed the Fed’s inflation battle is far from over, with money markets pricing in a four cuts by January 2025. This is a full cut lower than the same time last week.
  • Next Thursday’s Personal Consumption Expenditures print, the Fed’s preferred measure of inflation, will be key in determining next steps.
  • Westpac’s Leading Index prints on Wednesday after December’s -0.04% fall in economic activity. Strong YTD commodity performance suggests we may see positive growth for the January period.
  • Q4 wages are also out on Wednesday, with quarterly growth of 0.9% projected by economists after last quarter’s 14-year high of 1.3%. If the data prints as expected, this will match Q2’s increase and the 2 year average, but will still be 33% higher than the average over the last five years.
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Curve Team
Josiah Binet