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After yesterday's excitement for.......>

AUSSIE BONDS: After yesterday's excitement for Aussie Bonds in SFE post retail
sales data, taking the 3-Year benchmark contract to 3-Week highs and the 10-Year
to weekly highs both contracts have remained relatively steady on this session
ahead of Payrolls tomorrow scheduled for 1330BST/0830ET. The 3-Year was last
down 2 ticks at 97.860 and the 10-Year last down 2.5 ticks at 97.1650.
- The Aussie 10-Year bond auction came in strong (part of the underlying basket
for XMZ7,) cover was 4.5571x from 3.7x times previously on the same line and
sources reported 6k YMZ7 was sold as both contracts went on the descent at
97.85, both contracts came up very mildly despite headlines coming down from the
WSJ reporting the RBA is still not ruling out a rate cut even after retail sales
- MNI spoke to the RBA's Harper, Harper broadly said the RBA thinks interest
rates are more likely to go up than down but a loss in momentum in household
consumption mat be one of the reasons a cut could happen.
- Yields up across the curve, holding out from prior to the auction, the 3-Year
up 2.6bp and the 10-Year up 3.2bp.

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