Aussie Bonds had a limited reaction....>

AUSSIE BONDS: Aussie Bonds had a limited reaction to softer than expected

Australian core CPI readings and marginal negative revisions to Q2 core CPI

metrics.

- It is worth noting that the RBA has previously warned of "one-off declines in

some administered prices in the September quarter."

- 3-Year Bond futures trade off of session lows, while the modest bid that crept

into 10-Year futures after the release has faded, allowing the contract to

register fresh lows late in the day.

- The AU/U.S. 10-Year yield spread is holding around -52bp, while the domestic

3-/10-Year cash yield differential last deals at 62.5bp, ~2.5bp steeper on the

day as the long end underperforms.

- The Bill strip is little changed from pre-release levels, 1 tick higher to 1

tick lower on the day in the whites and reds. 3-Month BBSW fixed 0.5bp lower

today.