Aussie Bonds have operated in a........>

AUSSIE BONDS: Aussie Bonds have operated in a tight range during the SFE

session, with 3-Year Bond futures trading at 97.780 (-2.5 ticks), while 10-Year

Bond futures trade at 97.195 (-5.0 ticks), following Tsys lower.

- The domestic 3-/10-Year yield spread operates at 60.5bp (+2.6bp) while the

AU/US 10-Year spread is 1.5bp tighter at -20.2bp.

- 3-Month BBSW fixed 2.5bp lower at 1.955% today, with the white & red Bill

contracts last trading 2 ticks higher to a tick lower, as the fix supported the

front end of the strip.

- Focus has fallen on the AOFM's planned issuance schedule, released in lieu of

the Federal budget. The AOFM's gross Treasury Bond issuance in 2018-19 is

expected to be around A$70bln, with the AOFM noting that weekly Treasury Bond

tenders of around A$1bln each week (in addition to tenders held in conjunction

with buyback tenders) will be held for the remainder of 2017-18 and are planned

for 2018-19. The AOFM also plans to establish new bond lines maturing in

September 2023, May 2030, December 2030 and May 2041. The total issuance level

is lower than 2017-18, although this partly reflects the Snowy Hydro purchase.