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

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

(AOFM) will today sell A$300mn of the 2.75% 21 May 2041 Bond, issue #TB156. The

line was last sold on 15 July 2019 for A$300mn. The sale drew an average yield

of 1.9944%, at a high yield of 1.9975% and was covered 1.7675x. There were 30

bidders, 10 of which were successful and 6 were allocated in full. Amount

allotted at highest yield as percentage of amount bid at that yield was 95.6%.

- This is the 2nd tender of this line in the last month or so, with issuance in

the zone also bolstered by a A$400mn offering of ACGB 3.25% 21 June 2039 on

08/19. This points to a higher frequency of longer dated issuance, which

shouldn't be a surprise as the AOFM has prev. noted that it wants to extend the

curve & support liquidity of 20-Yr futures. The line's outright yield sits

~9.0bp off the lifetime low printed, which looks a little flat vs. ACGB 3.25% 21

June 2039 (owing to recent risk-off flows), but the '41 looks a little more

enticing vs. ASW. The recent rally in the long end also points to fresh demand,

which could have been relayed to the AOFM from the dealer community, resulting

in the re-opening of the line. Results due at 0200BST/1100AEST.