Aussie Bonds have held firm in the.....>

AUSSIE BONDS: Aussie Bonds have held firm in the wake of the AOFM's A$1.5bn

auction of the 2.50% 21 May 2030 Bond. When adjusted for the increased size of

the auction the cover ratio actually ticked higher, with the tail holding steady

in terms of length. Aussie Bond futures hover a little above the recent

cycle/contract lows, as Tsys hold above Tuesday's session lows.

- The domestic 3-/10-Year yield differential continues to edge steeper, last

62.5bp, while the AU/U.S. 10-Year yield spread hovers around ~-36.0bp as AU

paper outperformed Tsys.

- 3-Month BBSW fixed 0.2bp lower after moving higher over the last 2 fixings,

with the Bill strip last trading 1 to 2 ticks higher as repo rate and basis

pressure abates for now.

- The FOMC's MonPol decision provides the major risk event over the next 24

hours. Beyond that, participants will look to the AOFM's weekly issuance

schedule with interest, ahead of next week's RBA MonPol decision, AU trade data

& retail sales. It is also worth noting that RBA's Heath will make an appearance

next week.