03 Aug – 07 Aug 2015

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Government bond yields were higher last week with 3y bonds and 10y bonds both closing up 8bps to 2.88% 2.16% respectively. Trading ranges were limited to 10bps-11bps but yields finished the week at or near highs after the AOFM announced a heavy week of bond issuance, with $2.2bn of existing notes and bonds to be issued and a new 2040 index bond to raise $1.25bn. The RBA board meeting statement and the RBA quarterly Statement on Monetary Policy resulted in some weakness in yields as it downgraded growth forecasts and saw higher inflation ahead. 10y yields moved 7bps higher on the day of the board meeting, while the SoMP saw rates also move a little higher.

Offshore 10y bonds were quiet with German and French yields rising 1bps-2bps and US and UK yields falling 2bps and 4bps respectively. US labour/employment data came in over our weekend showing 213k jobs were created (vs an expected 225k). This takes US jobs growth to almost 3m in the past 12 months and is likely to see US rates rise in September.

There were two bond tenders last week; $900m Apr 2024s at a subdued coverage ratio of 2.422 and a well-bid tender of $800m Nov 2020s with a coverage ratio of 3.231.

See our New Debt Issues  for a complete list of debt issues
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AUST GOVT BONDS

MATURITYCOUPON
(%)
ISSUE
SIZE ($M)
CLOSING
YIELD
Δ WEEKΔ MONTHWEEK
HIGH
WEEK
LOW
WEEKLY T/OVER
$ VALUE
21-Oct-154.7511,3992.010.000.022.012.010
15-Jun-164.7521,9001.970.040.031.971.9338029
15-Feb-176.0021,0961.960.04-0.011.961.9341718
21-Jul-174.2518,9001.960.080.001.961.9030037
21-Jan-185.5020,5001.940.08-0.051.941.88118364
21-Oct-183.2513,5001.980.08-0.071.981.9129911
15-Mar-195.2521,4472.010.08-0.092.011.940
21-Oct-192.7511,7002.100.08-0.112.102.020
15-Apr-204.5020,3972.150.08-0.142.152.075400
21-Nov-201.755,0002.280.08-0.162.282.2052666
15-May-215.7522,2992.330.08-0.162.332.250
15-Jul-225.7518,2002.530.10-0.182.532.420
21-Apr-235.5021,3002.630.09-0.202.632.530
21-Apr-242.7522,9002.750.09-0.222.752.6519718
21-Apr-253.2518,9002.840.09-0.232.842.7326189
21-Apr-264.2516,9002.920.08-0.222.922.810
21-Apr-274.7515,1002.990.09-0.212.992.880
21-Apr-293.259,7003.150.09-0.223.153.040
21-Apr-334.509,8003.310.08-0.243.313.200
21-Jun-352.754,2503.440.09-0.243.443.320
21-Apr-373.757,5003.460.09-0.243.463.344051

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