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

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

(AOFM) will today sell A$1.2bn of the 1.50% 21 Jun 2031 Bond, issue #TB157. The

line was last sold on 13 November 2019 for A$800mn. The sale drew an average

yield of 1.3249%, at a high yield of 1.3275% and was covered 3.7400x. There were

34 bidders, 18 of which were successful and 10 were allocated in full. Amount

allotted at highest yield as percentage of amount bid at that yield was 7.2%.

- Issuance size is on the larger side, but not abnorma & only ACGB tender this

week. The line forms part of the basket for XMH0, but not XMZ9.

- The line's yield hovers just below the midpoint of the recent range, at

1.0910%, with domestic economic matters, as well as externalities, driving flow

in recent weeks/months.

- While month-end duration extensions are not seen as sizeable, they may drive

demand at the upcoming auction.

- The bond's ASW spread sits closer to the peak of its recent range than the

trough, but is back from wides, and still comfortably in negative territory.

- Results due at 0000GMT/1100AEDT.