Australian Bond Exchange Weekly Update
13 May 2026
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Market Insights
- Our new 7.90% p.a. A$ Credit-Linked Note over Unisys Corp. is closing soon
- Australia’s residential housing market is cooling
- US annual headline CPI beating consensus estimates
- US retail sales are still strong
Key Points:
- Australia: The RBA increased cash rates by 0.25% to 4.35% p.a. at its April meeting. March CPI increased to 4.10% p.a., and the Trimmed Mean increased to 3.50% p.a.
- United States: The Federal Reserve left the federal funds rate unchanged at 3.50%–3.75% p.a. at its April 2026 meeting. The latest U.S. CPI inflation rate is at 3.8% p.a. as of April 2026. Core CPI was more contained at 2.8% p.a.
- United Kingdom: The Bank of England held Bank Rate steady at 3.75% p.a., and CPI for March increased to 3.3% p.a., up from 3.0% in February
- Eurozone: The European Central Bank kept its key deposit facility rate unchanged at 2.00% p.a., and recent data show inflation in the euro area increased to 3.0% p.a. in April, up from 2.6% in March.
| Region | Policy Rate | Latest Inflation (YoY) |
|---|---|---|
| Australia | RBA Cash Rate 4.35% p.a. | 4.1% p.a. to March 2026 |
| United States | Fed Funds 3.50–3.75% p.a. | 3.8% p.a. to April 2026 |
| United Kingdom | Bank Rate: 3.75% p.a. | 3.3% p.a. to March 2026 |
| Eurozone | Deposit Facility Rate: 2.00% p.a. | 3.0% p.a. in April 2026 |
Australia’s residential housing market is cooling
Australia’s weekend auction clearance rates suggest the housing market is cooling. Sydney’s auction clearance rate dropped to 49%, which is the worst outcome since auction results were heavily disrupted during the 2020 Covid crisis. Nationally, the rate was at 57.5%, the fifth time in the past seven weeks it has dropped below 60%, and the third lowest result for the year to date. Auction listings in Sydney and Melbourne were down by 14.9% in the past week.
Australian consumer spending was broadly flat in April
A recent NAB consumer spending report showed that consumer spending declined 1.1% in April, reflecting lower fuel prices, easing stockpiling behaviour, and continued travel-related refunds and cutbacks. Excluding fuel, spending fell 0.8%, driven mainly by weaker discretionary spending, led by a 9.3% decline in travel spending. Excluding fuel, non-discretionary spending was broadly flat. Food spending declined 1.0%, reflecting a normalisation in spending following precautionary purchases in the previous month, although this was partly offset by higher insurance and utilities & telecommunications spending.
US annual headline CPI beating consensus estimates
Annual headline CPI for April increased to 3.8% from 3.3% in March exceeding consensus estimates of 3.7%, making it the highest in three years. Energy prices accounted for over 40% of the monthly increase. The annual core reading was 2.8% against expectations of 2.7% and up from 2.6% in March. Pricing for rate cuts by the Federal Reserve earlier in the year appears off the table for now, making Kevin Warsh’s initiation to the Fed chair a little more difficult to deliver cuts sought by the president.
US retail sales still strong
US retail sales were stronger than expected, rising 0.5% (MoM) on both the headline measure and the core measure. Non-store retailers and electronics recorded the largest gains over the month, while growth in gas station spending was comparatively modest following a sharp increase in the previous month. The data pose upside risk to real consumer spending forecast, with the current run rate tracking above 2%.
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Closing soon: A$ Unisys Corp. 7.90% p.a.
Fixed Income Credit-Linked Note
Our new 7.90% p.a. A$ fixed income offering from Unisys Corp. which is eligible for retail and wholesale investors is closing soon. This product pays semi-annual coupons and offers exposure to a global IT services provider.
About Unisys Corp.
The Unisys Credit-Linked Note provides investors with exposure to the credit of Unisys Corporation, a global IT services provider with a broad base of recurring contracts across government and enterprise clients worldwide. Unisys operates a managed services model, generating stable and predictable revenue through multi-year engagements spanning both public and private sectors. The company generates approximately ~$2B in annual revenue, with the government sector representing a significant and stable portion of its business. The majority of this revenue is derived from U.S. federal agencies and international governments, supported by long-term contracts in areas such as border security, digital government services, and IT outsourcing. Hundreds of active contracts globally reduce client concentration risk.
Investment Overview:
| Issuer: | C2 Specialist Investment Pty Ltd (ACN 622 433 043) |
| Product: | Unisys Corporation – Credit Linked Security |
| Type: | Fixed Income Investment |
| Target Coupon: | 7.9% p.a. paid, Semi-Annually |
| Term: | 20/06/2031 |
| Currency: | AUD |
| Min. Investment: | $10,000 |
| Eligibility: | Retail and Wholesale Investors |
Example: How Fixed Income Works
A company issues a debt security with the following terms:
- Term: 5 years
- Coupon: 7.9% p.a., paid semi-annually
- Issue Price: $100
- Minimum Investment: $10,000 AUD
Investor Scenario: Semi-Annual Payments
Sarah may choose to receive income every 6 months. She receives $3,950.00 every 6 months (7.90% × $100,000 / 2). Over 5 years, she receives $39,500.00 in total income, plus her $100,000 principal at maturity (subject to no credit event or early redemption).
If she sells before maturity, she may receive more or less than $100,000 depending on market conditions.
- Capital invested in the Units is at risk: There is no capital protection or guarantee of financial return in respect of your investment in the Units.
- Credit exposure to Reference Entity: The Units will reference the credit of the Reference Entity, therefore the Units include a risk of capital loss in part or in whole, as the result of Credit Event(s) occurring with respect to the Reference Entity.
- Credit Rating: Investors should be aware that credit ratings do not constitute a guarantee of the quality of the Units or the Reference Entity.
- Secondary Offer Period: Investors who purchase Units in the Secondary Offer Period at an Issue Price greater than the Initial Issue Price of $100.00 will receive a lower overall return, as the Final Value and Coupons are calculated with respect to the Initial Issue Price of $100.00 per Unit.
- Performance of the Reference Entity: Historical performance of the Reference Entity should not be taken as an indication of the future performance of the Reference Entity during the Investment Term.
- Value of the Units before the Maturity Date: The Final Value of the Units is calculated by reference to the Reference Entity and its overall creditworthiness between the First Credit Event Occurrence Date to the Scheduled Last Credit Event Occurrence Date. The market value of the Units before the Maturity Date will be determined by many factors and may be less that what you paid for the Units.
- Liquidity risk: You may not be able to realise your investment when you want to. The Issuer Buy-Back facility is at the discretion of the Issuer. Issuer Buy- Back requests are determined in the Issuer’s discretion.
- Early Maturity: The Units may mature early following an Early Maturity Event, including as a result of an Adjustment Event or Market Disruption Event or if a Credit Event or a Compulsory Early Redemption occurs or if your request for an Issuer Buy-Back is accepted.
- Indirect Investment Risk: Compared to a direct investment (including bonds) in the Reference Entity, the investor will not be entitled to receive dividend or other payments (if any) nor have any voting rights for corporate actions to do with the Reference Entity, including if a Credit Event occurs.
- Counterparty Risk: Investors are subject to counterparty credit risk with respect to the Issuer and the Hedge Counterparty.
For a full explanation of Key Risks please refer to the Term Sheet PDS. Investors should also refer to Section 2 “Risks” of the Master PDS.
An investment in the Units is not equivalent to an investment in the bonds of the Reference Entity.
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*Data accurate as at 13.05.2026
Disclaimer: This webpage has been prepared by Australian Bond Exchange Pty Ltd ACN 605 038 935 AFSL 484453 (ABE). The information contained in it is of a general nature only. It was prepared without considering your financial needs, circumstances and objectives. Before investing in this security, you should consider whether it is appropriate for your circumstances and review the Master PDS and PDS. This website may contain links to other third-party websites, some of which require a subscription to read. Such links are for your convenience only, and ABE does not recommend or endorse these third-party sites. No representation or warranty is made as to the accuracy, completeness or reliability of any estimates, opinions, conclusions, or other information contained in this website. This website may contain certain forward-looking statements. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, and other factors, many of which are beyond our control. Past performance is not an indication of future performance. To the maximum extent permitted by law ABE disclaims all liability and responsibility for any direct or indirect loss or damage that you may suffer as a result of relying on anything on this webpage.