Aussie Bonds have clung to SYCOM.......>

AUSSIE BONDS: Aussie Bonds have clung to SYCOM closing levels, after tracking

Tsys higher during Thursday's SYCOM session as worries over geopolitical and

trade matters spilled into Bonds & EMFX, following the initial RBNZ inspired

bid.

- 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 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.

- Focus next week turns to the domestic labour market report, wage data,

confidence surveys and addresses from RBA' Gov. Lowe & RBA's Ellis.