Daily Flows & Commentary BY THE CURVE TEAM –

Daily Insights and Flows – China Tells World Not to Raise Rates

Tuesday, 18th January, 2026

Daily Flows

  • We were glad to see really strong bond flow to kick off the week. Both fixed and floating bonds continue to offer relative value above TDs and NCDs, so it is great to see those with the capacity capitalise on the opportunity. For example, a floating Bendigo August 2026 line traded at good discount, creating additional capital gain opportunities.
  • The Suncorp (AA-) 2026 issuance launched, printing a $775m FRN with a final orderbook in excess of $1.25bn across the floating and fixed lines. The final price set at +78. Westpac has announced a 5-year issuance of its own this morning, with indicative pricing at +73.
  • NAB longer-term term deposit rates increased, with the 5-year rate now close to 2%, the highest rate we have seen from them in quite some time.

China Tells World To Not Raise Rates

  • Chinese President, Xi Jinping, has vocalised that western countries should not raise rates.
  • It comes as the president stated, “If major economies slam on the brakes or take a U-turn in monetary policies, there will be serious spillovers that will present challenges to global economic and financial stability, and developing countries will bear the brunt of it”.
  • Rather, what Xi would rather is, “we will first make the pie bigger, and then divide it properly through reasonable institutional arrangements.”
  • Meaning, continue global growth so that prosperous countries succeed now, and then funnel the wealth to those who need it.
  • Communist or not, this view is highly controversial and unprecedented, with no world leader suggesting a widespread, global monetary policy.
  • China cut rates overnight by 10 basis points, now resting at 2.85%
  • 4th quarter Chinese GDP prints were released yesterday, showing 1.60% seasonally adjusted Quarter on Quarter, and 4.00% Year on Year.
  • Thus, a slow down of global growth will present numerous headwinds for the Chinese economy, who are hoping to continue growing at extreme levels.

The Market – At Time of Writing

  • Australian 2Yr 0.85%, 5Yr 1.580%, 10Yr 1.932%.
  • AUDUSD – 0.7210
  • ASX200 – 7417.31
  • ANZ Weekly Consumer Confidence has been released today, coming in at 97.9, falling from the prior reading of 106.0

Nicholas Allan

Associate - Money Markets