AUCTION PREVIEW: The Australian........>

AUSSIE BONDS: AUCTION PREVIEW: The Australian Office of Financial Management

(AOFM) will today sell A$900mn of the 2.50% 21 May 2030 Bond, issue #TB155. The

line was last sold on 13 May 2019 for A$500mn. The sale drew an average yield of

1.7479%, at a high yield of 1.7500% and was covered 3.7600x. There were 29

bidders, 18 of which were successful and 9 was allocated in full. Amount

allotted at highest yield as percentage of amount bid at that yield was 13.8%.

The line has A$18.7bn outstanding, with a modified duration of 9.66 years, and

is the longest bond in the XMM9 bucket.

- The new June 1.50% 2031 ACGB will receive a far greater share of future

issuance than the May 2030, which could support the May 2030 ACGB, although May

2031 may be preferred by those trying to capture the extra return

characteristics of holding a longer bond i.e. via price swings, albeit with a

lower coupon.

- The 04/26-05/30-04-33 yield fly sits just above the mid-point of its 12-month

range at writing.

- Results due at 0200BST/1100AEST.