Bond/OIS would continue to trade within the set ranges of 8.12-8.15% (10Y Bond); 7.57-7.62% (1Y OIS) and 6.97-7.02% (5Y OIS) and test/break either-way will trigger our trading actions as specified earlier. The near term outlook (post-policy) is bullish for gradual move into the lower end of set short term ranges of 8.02-8.17%, 7.47-7.62% and 6.87-7.02%. Strategic investors to hold on to “longs” entered above 8.17% (and 5Y OIS book above 7.02%) for this move.
FX Premium will continue to stay in consolidation mode at 6.25-6.5% (3M) and 5.35-5.6% (12M); test/break either-way will trigger our trading actions. The strategy is to receive 3M at 6.50-6.65% and 12M at 5.60-5.70% for post-policy move into lower end. There are no strong cues to suggest break of lower end at this stage.
Good luck...............Moses Harding
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