A limited start to SFE trade for the...>

AUSSIE BONDS: A limited start to SFE trade for the space, with YM +1.5 & XM

+3.5, leaving YM/XM at 20.0 & the cash equiv at 18.9bp after the space followed

the lead of the U.S. curve overnight. A lot of discussion has cropped up around

RBA Dep Gov Debelle's comments from yesterday re: the lower bound for the cash

rate & extraordinary policy measures. We covered the matter in full at the time.

Our latest insight piece added to the discussion, noting that the RBA "is likely

to implement a package of stimulus measures, and not just QE via gov't bond

purchases, should its hopes for housing recovery prove unfounded & prompt it to

make further rate cuts, MNI understands. For the moment, the Bank believes

fiscal stimulus and its previous monetary policy moves, have built a floor in

the housing market, which should bolster consumer confidence."

- Bills trade 1-3 ticks higher through the reds.

- Q2 completed construction work gets the GDP input readings underway later

today, ahead of next week's GDP print proper. Elsewhere, the AOFM will come to

market with A$800mn worth of ACGB 2.50% 21 May 2030. Corporate issuance has seen

Bendigo & Adelaide Bank launch a 5-Year deal for up to A$750mn.