AU Bonds proved to be a little.........>

AUSSIE BONDS: AU Bonds proved to be a little stickier than U.S. Tsys, and

struggled to turn bid as Trump outlined the latest round of U.S. tariffs to be

imposed on Chinese goods. Outright Bond futures are last dealing at session lows

with participants focusing on the pricing of A$3.75bn of the new 2050 I/L Bond

(real yield 1.16%) for the majority of the session.

- The lack of dovish rhetoric in the minutes from the RBA's latest MonPol

decision did little for AU Bond bulls, as the Bank offered an upbeat view on

growth and the domestic labour market, which allowed the RBA to reiterate that

the next move in its cash rate will likely be up. The turnaround from early risk

off sentiment also weighed during the latter half of the session.

- The AU/U.S. 10-Year spread is back in to ~-34bp on the back of AU paper's

underperformance.

- On the corporate issuance front NAB launched its 5-Year A$ Bond line.

- The Bill strip last trades 2-4 ticks softer. 3-Month BBSW fixed -0.2bp today,

but the space paid more attention to higher repo rates & basis dynamics pointing

to funding strains into quarter end.