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Aussie bonds descended from the........>

AUSSIE BONDS: Aussie bonds descended from the start of SFE, the 10-Year
recovered slightly towards the end of the session but the 3-Year closed less 3
ticks at 97.830, the 10-Year less 1 tick at 97.140. Aussie bonds had a flat
overnight SYCOM session due to the U.S. National holiday, Columbus Day. The sell
off on SFE came as we heard large blocks of TYZ7 and YMZ7 were given. 
- An extremely lack-lustre index-linked bond auction didn't help the two
contracts either, positive comments on inflation from RBA speakers and big banks
may have discouraged investors, the auction for A$150mln Index Linked bonds came
in 2.6x covered from 3.57x previously covered and with an average yield of
1.2167%, up from 1.1158%. On Wednesday Australian Q3 CPI data is going to be
released and ANZ forecast that CPI will rise by 0.8% q/q, they said "a result in
line with our forecast would see annual inflation rise to 2.0% y/y," also, last
month the RBA's Luci Ellis said the Australian economy has reached 'a turning
- Yields are up across the curve, steepening through the session, the 3-/10-Year
spread is currently at 1bp.

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