Aussie bonds saw an anaemic range......>

AUSSIE BONDS: Aussie bonds saw an anaemic range again, with quiet range bound

trade ahead of key data events in the UK and US in the upcoming session.

- Aussie bond futures dipped during SYCOM as UST's fell on stronger than

expected US retail sales. 3- & 10-Year futures then both saw rangebound trade

for the duration of the session, moving in a tight two tick span.

- Yields dropped on the open and moved mostly in a 1bp range. The curve

flattened slightly with the 3/10-Year spread 0.5bp narrower at 65.3bp but within

stays within the range of 60-70bp seen since the end of June.

- Markets ignored the wage price index data which rose 0.5% on the quarter in

line with estimates, this is just above the record low of 0.4% hit in Q4 2016.

Westpac note that the outcome is still soft in relation to the tightening

conditions in the labour market. Figures for the labour market in July will be

printed tomorrow and will be closely watched for further erosion of slack. The

market also ignored the A$900mln 3.25% April 2029 auction; demand was weaker

than previous despite the yield concession, with the larger auction size and

risk on sentiment being blamed.