China onshore IRS are sharply lower after another dismal U.S. jobs data cast further doubts over the health of the global economy, fueling expectations for additional easing measures by global policymakers. Still, the downside is likely to be limited as the PBOC didn't cut rates over the weekend. The one-year IRS is 1 bp lower at 2.36%-2.46%, the five-year IRS is 3 bps lower at 2.67%-2.77%; the one-to-five-year spread is 2 bps narrower at 31 bps. "The swaps have fallen a lot recently and they will consolidate around current levels unless the PBOC announces fresh easing measures," says a Shanghai-based local bank trader. The one-year IRS fell around 80 bps in May.
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