Daily Flows & Commentary BY THE CURVE TEAM –

Daily Flow & Insights – U.S CPI to Come

Tuesday, 12th April, 2022

Daily Flows

  • Flows were steady to start the week as many investors sought to replace maturing funds.
  • NCD flows were particularly strong, with margins holding firm at recent levels. Term interest was spread quite evenly across the curve from 2 months to 1 year.
  • Macquarie Bank continue to attract standout volume off the back of another TD rate lift, with 1-year investments proving most popular.

U.S. CPI To Come

  • March CPI data will be released at 10:30pm tonight.
  • Headline CPI is expected to rise by 1.30% MoM. New 40 year highs are expected to come in at 6.6% YoY.
  • Inflation is persistent and is at the forefront of the Fed’s decision. Many Fed officials have stated their concerns of inflation, and that it should be addressed with a 50 basis point hike at the next meeting.
  • Alongside this, Quantitative Tightening (QT) is soon to start, commencing in May. QT is largely unknown, and the size of this reduction significantly outweighs the 2019 trial run.

Domestic Data Today

  • Consumer confidence and Business Conditions are releases today.
  • Confidence and conditions are expected to increase. However, with increased inflation, the firms ability to pass on increased costs will start to weigh into these reads.

Nicholas Allan

Associate - Money Markets