AUD Swaps: More 3-10y offers as RBA pauses second time in a row

RBA Building
The RBA surprised some players by keeping the interest rate unchanged again. 3-10y swaps saw more receiving after the decision.

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  • RBA pauses second time in a roll

  • 3-10y offered more after RBA


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RBA pauses second time in a roll

The RBA has surprised some players by keeping benchmark interest rate unchanged at 4.1% when the board concluded this month’s monetary policy meeting earlier today. Prior to the meeting, there was a significant number of players betting for one last hike this month.


The RBA re-iterated that it would do what is necessary to achieve the country’s inflation goal although at present inflation expectations have been consistent with target, consumption growth has slowed substantially, and that wage growth has picked up in response to the labour market.


The central bank, however, said further monetary tightening may be required in the future depending on how inflation and the economy evolve.



3-10y offered more after RBA

The market took the decision and the comments as a dovish stance. Indeed, some swap players had already prepared for it, as suggested by receiving in 3-year at down to 3.75bps lower at 4.1525% before the RBA. 3-year was offered down to 4.08% intraday before being marked about 4.25bps lower at time of writing and last traded at 2bps lower of 4.17%.


10-year traded 4.5bps lower of 4.43% in the morning before further receiving at down to 4.385% after RBA.


EFPs were tighter across the curve. 3- and 5-year were down 0.75bp at 31.5bps and 41.75bps respectively, while 10-year was down a basis point at 41.25bps.