Aussie bonds head in to the close......>

AUSSIE BONDS: Aussie bonds head in to the close broadly flat, futures gained

during the SFE session to reverse intial losses.

- RBA Deputy Governor Debelle gave an upbeat assessment of the economy in a

speech, but said that rates won't rise unless the economy is stronger. These

comments sparked a slow grind higher in futures which topped out around levels

seen at the start of SYCOM trade before trading in a narrow range in thin

volumes following the RBA decision and the SOMP at the end of last week.

- The rise in bonds was supported by a decline in Australian equities, the ASX

200 down around 7.5 points at the close as the Australian government endures

uncertainty after John Alexander becomes the second lawmaker to step down over

dual citizenship.

- Yields higher from the belly onwards on the curve, long end more resistant to

the bid. 3-Year yield last down 0.3bp at 1.940%, 10-Year yield last up 1.1bp at

2.623%.

- Markets look ahead to linker sale on Tuesday and Labour Market data on

Thursday.