Aussie bond futures unwound their......>

AUSSIE BONDS: Aussie bond futures unwound their early bid & more on the back of

the domestic Q2 CPI data.

- As expected, fuel was the main driver for headline CPI, allowing both the Y/Y

& Q/Q metrics to top market consensus, at the margin. The headline reading

missed RBA exp. of +1.7% by 0.1 pp, while the trimmed mean reading met the RBA

exp., printing at +1.6% Y/Y. This will likely remove any pressure that the RBA

may have been feeling re: pulling the trigger again in August, as referenced by

market pricing (in the IB strip) since the release.

- YM -0.5 last, with XM +0.5 tick, with both contracts back from lows,

potentially aided by month-end flows, with the curve flatter after some light

steepening earlier in the day.

- Private sector credit data came in on the weak side, with business credit

slipping for the first time since January 2017 (in m/m terms).

- Bills trade 1-4 ticks lower through the reds.

- Focus tomorrow turns to CoreLogic house price data.