Aussie bonds saw another quiet.........>

AUSSIE BONDS: Aussie bonds saw another quiet session ahead of the RBA tomorrow.

Aussie bond futures head into the close around 1 tick higher in both 3- and

10-Year maturities, while yields are mixed across the strip with moves subdued.

Volumes were thin with the 3-Year future seeing around 65% of typical volume.

YMU7 saw a blip higher at the open with some 10k paying the move up to 98.05.

- Bonds largely ignored data during the session, the Melbourne Institute

Inflation Gauge was broadly in line with the previous month; new home sales

dropped sharply in June, falling 6.9% against a 1.1% rise in May, the print

reverses the previous two months gains; China PMI spurred equity markets which

bought bonds off their highs but the move accounted for around 0.5 ticks in

futures; strong private sector credit data did knock Aussie bonds off session

highs but bonds stayed within tight ranges, private sector credit rose 0.6% on

the month against 0.4% expected.

- Yields in the short end are lower with the long end selling off slightly

pushing yields higher and steepening the curve, sources note this is just

positioning ahead of what is expected to be a dovish RBA tomorrow.