3-Year futures last trade at 97.910....>

AUSSIE BONDS: 3-Year futures last trade at 97.910 (+2.0 ticks) with 10-Year

futures last at 97.255 (+5.0 ticks)

- The space has stabilised over the last couple of hours after the decent 2 way

seen early on & after the soft Q4 CapEx release (albeit with a notable upward

revision to Q3).

- The release has led Westpac to downgrade their Q4 GDP estimate to 0.5% QQ from

0.6%.

- ANZ are a little more upbeat highlighting that although "investment

unexpectedly declined in Q4, as non-residential investment fell. Plant &

equipment spending rose solidly however. The outlook for capital spending

remains positive, with a solid non-mining investment pipeline and a reducing

drag from the mining investment decline."

- The domestic 3-/10-Year curve has continued to flatten, with the yield

differential last trading 1.7bp flatter at 67.9bp. - The AU/US 10-Year spread

has moved further in to negative territory, last 2.1bp lower at -11.1bp.

- The white bill contracts are flat to a tick higher.