Aussie Bonds clung SYCOM closing.......>

AUSSIE BONDS: Aussie Bonds clung SYCOM closing levels in early dealing, after

tracking Tsys higher during Thursday's SYCOM session as worries over

geopolitical & trade matters spilled into Bonds & EMFX.

- There was no notable reaction in Aussie Bonds to the latest RBA SoMP, which

held no particularly large surprises with the change to the unemployment

projection flagged earlier in the week, while the short term minor moderation in

the Bank's inflation outlook does little to change policy stance. Commentary

around wage growth remains muted. There was commentary on the increase in money

market rates locally but much of it was similar to the May statement.

- The real shunt higher came on the back of the broader risk off flows on the

aforementioned bank/Turkey story in the FT.

- The domestic 3-/10-Year yield differential is a touch flatter at ~57.0bp,

while the AU/U.S. 10-Year yield differential continues to operate just below

-30bp.

- The Bill strip is 1 tick lower to 3 ticks higher last, front end

underperforming on a higher repo rate owing to large maturities.