A quiet session on the cards for.......>

AUSSIE BONDS: A quiet session on the cards for Aussie bonds to kick off the

week, markets were choppy on Friday, UST's ending near highs and dragging Aussie

bonds higher. 

- 3-/10-Year spread narrowed slightly, dropping to 77.4bp from a session high of

78.5bp on Friday. AU/US 10-Year spread continues to be volatile, last at 3.1bp

after briefly dropping into negative territory last week. The spread has not

been consistently below zero since 2000.

- A quiet data session for Australia with volumes expected to be thin due to the

Japanese market holiday today (National Foundation Day) and Chinese market

holiday (Lunar New Year) starting on Thursday. The only domestic data today is

Australia Credit Card Purchases at 0030GMT/1130AEDT. Market will focus on

Australian Labour Market data on Thursday this week, especially after the RBA

flagged weak inflation in several more dovish bouts of communication last week.

- In early trade yields higher, some steepening seen on the curve following the

broader trend of the past week and reversing the move on Friday.