Daily Flows & Commentary BY THE CURVE TEAM –

Daily Flow & Insights – RBA, Brainard, & Russia

Wednesday, 6th April, 2022

Daily Flows

  • Yesterday was again a more or less standard day in terms of trade flows.
  • 0.75% for 3 month TD funds was briefly available from an unrated domestic name, with 0.70% otherwise remaining the highest carded 3-month rate from the BBB- rated Judo Bank.
  • ING Bank (A-1/A) attracted steady flows with their market-leading 1-year TD rate of 1.68%.
  • It is again worth noting that 1-year NCD levels and bond yields across the curve can be found at higher levels than equivalent term deposits, with TD pricing experiencing a more lagged adjustment to recent dramatic increases in reference rates.


  • The RBA’s Monetary Policy Decision was left largely unchanged.
  • However, the rhetoric showed the removal of a key line, which was “The RBA is prepared to be patient”.
  • Therefore, rate hikes expectations have been brought forwarded by economists, and are as early as June.
  • The next CPI release is the 27th of April, and will be eagerly watched by the market and the RBA. If this read surprises on the upside then economist predictions may seem more plausible.


  • Typically, Fed Governor Brainard’s economic predictions are dovish.
  • Last night, Brainard moved markets, expressing the need to reduce the balance, and fast.
  • Further to this, she called for calibrated rate hikes.
  • To quote Brainard, “I expect the balance sheet to shrink considerably more rapidly than in the previous recovery”
  • Bonds sold off, with the 10Yr proving particularly vulnerable to Brainard’s comments, up 15 basis points.


  • Russian tensions have increased again as Europe deported a number of Russian diplomats.
  • Further to this, European member states have also proposed a ban on Russian coal, and banning Russian trucks and vessels reaching European ports.
  • However, European inflation has now hit 7.50% YoY, with the largest component being energy prices, up 40% YoY.

Nicholas Allan

Associate - Money Markets