Daily Flows

• As we approach the end of the quarter, market participants may expect a pickup in activity, with banks reviewing quarterly cash and liquidity positions.
• Last week, a slight uptick in the yield curve, driven by stronger-than-expected labour market data, pushed 6-month NCDs to an outright level of 5.02%.
• Demand for term deposits has been quiet in the domestic market, with most funds flowing towards larger ‘A’-rated institutions.

The Week Ahead

• It’s set to be a busy week, with key data points both domestically and from the U.S.
• To start, the RBA meets on Tuesday to decide on monetary policy, with expectations that that cash rate will remain unchanged, accompanied by a hawkish statement.
• Stronger-than-expected labour data has likely reinforced the RBA’s hawkish stance. Equities are expected to dip ahead of the meeting as markets begin to take the RBA’s stance more seriously.
• Australia finds itself increasingly at odds with global central banks, having had a shallow and delayed hiking cycle.
• Mid-week, we will see the release of the domestic monthly CPI data, forecasted to come in at 3.1% year-on-year.
• The latter half of the week includes key U.S. events: durable goods data, the final GDP print, Powell’s address to the market, and the PCE index on Friday.