US Treasury yields have tracked a little higher, with the 10-year rate up about 1 bp from the NZ close and that gain coming ahead of Bostic and Yellen speeches.
So the movement reflects a slightly better mood for risk assets than any change in monetary policy expectations.
NZ rates were lower across the curve yesterday, largely a response to the move lower in US rates in the previous session than local factors.
The 2-year swap rate fell by 2 bps to 2.19% and the 10-year rate fell by 4 bps to 3.18%. If we look at the NZ-US 10-year government bond spread pre and post-election, we don’t detect any significant impact from NZ’s election result. From Friday’s local close around 75 bps, the spread had narrowed slightly to 73 bps as at yesterday’s local close.
The day ahead looks fairly uneventful. Overnight sees the release of US durable goods orders data and a couple more Fed speakers on the circuit.
Daily swap rates
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Jason Wong is on the BNZ Research team. All its research is available here.
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