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

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

(AOFM) will today sell A$1.0bn of the 1.25% 21 May 2032 Bond, issue #TB158. The

line was last sold on 18 March 2020 for A$500mn. The sale drew an average yield

of 1.2852%, at a high yield of 1.2900% and was covered 3.5960x. There were 40

bidders, 7 of which were successful and 4 were allocated in full. Amount

allotted at highest yield as percentage of amount bid at that yield was 20.0%.

- Today's auction may not be as strong as those witnessed last week: Monday's

chunky round of coupon payments may not come soon enough to support today's

auction, while the huge 2024 syndication seen earlier this week may have

diverted cash into the belly of the curve already.

- Also worth remembering that this bond doesn't fall into the XMM0 basket.

- The line's ASW spread briefly bumped into positive territory earlier this

week, but has retraced from 12-month highs (although still remains elevated over

that horizon).

- Results due at 0200BST/1100AEST.