Daily Flows

• Approaching the end of the month, market participants should look to take advantage of bespoke offerings as ADIs meet their monthly funding requirements.
• There is significant demand for funds in the NCD space, with outright levels of 4.80% for 3-month NCDs.
• Outright levels at the longer end of the curve continue to stand out, with 5.67% being offered by an ‘A’-rated bank.

Israel-Hamas Ground Invasion

• Israel has initiated the “second stage” of its war against Hamas, involving a ground invasion.
• The scale of the ground invasion remains uncertain, and Prime Minister Netanyahu has warned that it will be “long and difficult.”
• Since the Hamas attack on October 7, the price of WTI oil has increased by only 3.3%, gold has risen, and equities have fallen.
• There is concern in the markets about the potential for a broader conflict to develop.

The Week Ahead

• This week starts off with domestic retail sales.
• Last month, sales increased by 0.2% MoM as consumer spending was restrained.
• Economists are forecasting an uptick of 0.5% for September.
• Later in the week, Assistant RBA Governor Brad Jones is speaking at the AFIA Conference.
• Markets will be combing this address for hints on next week’s Melbourne Cup day meeting.
• Inflation rates across Europe will be reported to the markets as the week progresses.
• In the United States, the Federal Reserve will meet to make a decision on monetary policy, where the Fed is expected to keep rates on hold.