Indonesia Surprises Markets with Interest Rate Cut Amid Currency Pressure 
Bank of England Set to Hold Interest Rates as Inflation Risks and Iran War Impact Loom 
AI-Driven Inflation Raises U.S. Consumer Prices, Goldman Sachs Says 
Wall Street Analysts Weigh in on Latest NFP Data 
Fed May Resume Rate Hikes: BofA Analysts Outline Key Scenarios 
Gold Prices Slide as Rate Cut Prospects Diminish; Copper Gains on China Stimulus Hopes 
South Korea Central Bank Signals Inflation Concerns as Oil Prices Surge 
RBA Raises Interest Rates to 4.35% Amid Rising Inflation Risks and Middle East Tensions 
U.S. Banks Report Strong Q4 Profits Amid Investment Banking Surge 
Stock Futures Dip as Investors Await Key Payrolls Data 
South Korea Central Bank Signals Cautious Policy Amid Inflation and Middle East Tensions 
From a central bank perspective, the RBA continues to keep the faith in the 3% growth story for Australia. In its most recent communication, the RBA acknowledged the likely softness in 1Q GDP but refrained from reading too much into a weak print.
Our RBA outlook (on hold for some time) is anchoring front end valuations. We expect 3yr swap rates to remain in a 1.8% to 2.3% range, with core inflation still below 2%.
On the flip side, the RBNZ has signaled the next cycle – a tightening one – will not start until the end of 2019. That will anchor the short end, although markets will not abandon their expectations for tightening as early as mid-2018 which would imply that occasional spikes in the 2yr will be likely. A 2yr swap range of 2.10%-2.60% is expected. The long end will continue to follow US yields, which we expect to rise. That means the curve steepening trend should continue.
Buy a 2-month AUDNZD 1.09-1.11-1.13 1x2x1 call fly,
Buy 1M AUDUSD vs AUDNZD vol spread, equal vega.
Alternatively, aggressive bears can bid NZDJPY 1m2m IVs & RR and buy 75 NZDJPY OTM put of mid-month tenors, sell a 1m in premium-rebate notionals.
