Daily Flows & Commentary BY THE CURVE TEAM –

Daily Flow & Insights – Consumer Confidence Remains Low while ECB Looks to Hike

Tuesday, 24th May, 2022

Daily Flows

  • It was a relatively quiet day yesterday, at least in comparison to the recent chaos we have become used to over the past two weeks.
  • Despite the more relaxed tones yesterday, several ADI’s continue to seek funds, presenting attractive investment opportunities. 1.60% remains available for 3-month unrated term deposits, while ING Bank lifted their 1-year rate to a standout 3.15%, the highest rate available in the A rated space by some margin.

ANZ Consumer Confidence

  • ANZ consumer confidence was released this morning, increasing slightly to 90.8 from last month’s low, but is still at its lowest point since August 2020.
  • The majority of this data would have been collected prior to the election result, likely reflecting mounting inflation and interest rate worries as well as the uncertainty from the election.

ECB Lift-off

  • European Central Bank President Christine Lagarde expressed her support to hike interest rates in July overnight, expecting rates to lift out of negative territory by Q3 this year.
  • This comes after mounting pressure for the ECB and other central banks to clarify their paths to rate normalisation.
  • Global bond markets saw renewed selling pressure as a result, with the US 10-year lifting 7bps to 2.86% and a similar move from German bunds.

Lawrence Vosper

Business Analyst