From ANZ this morning comes the news that the Australian Office of Financial Management (AOFM) is lengthening the Australian Government Bond Curve, by issuing a new 21-April-2033 Treasury bond.
Normally this is pretty boring, but as ANZ points out:
“This will extend the Australian Commonwealth Government Bond (ACGB) curve to 20-years, bringing it more in line with other AAA-rated global bond markets”
The problem with that is it “further increases the liquidity of the Australian government bond market; and, provides a mechanism via which we can further develop Australia’s corporate and infrastructure bond markets.”
Which is great, except that this also increases the attraction of Australian government debt, and in time the Aussie dollar.
It will be priced on Tuesday 19 November.
Greg McKenna is an active currency trader and holds positions in the AUD.