Aussie bonds dropped heading into......>

AUSSIE BONDS: Aussie bonds dropped heading into the close after a rangebound

session in Asia. After opening SFE lower following a drop in US tsys and

subsequent Aussie bond move on SYCOM, Aussie bonds saw rangebound trade with the

July Skilled Vacancies data (0.8%, Prev. 0.9%) passing without incident.

- The AOFM announced the syndicated issue of new 0.75% 21 November 2027 Treasury

Indexed Bond pricing at a real yield to maturity of 0.8725%. The issue size was

A$3bln in face value terms, total of A$5bln of bids at the final clearing price.

The sale sale saw a flurry of selling in the long end with the 10-Year future

being hit especially hard, sources noting the bid hit around 15k times to take

the contract from 97.33 to session lows of 97.315. YMU7 also saw some decent

selling with 98.00 bid hit 8k times.

- Yields finished higher after opening up across the curve and then jumping on

the syndicated sale, the curve continues to steepen with the 3-/10-Year around

1.8bp wider.