Aussie bonds were bid on the back of...>

AUSSIE BONDS: Aussie bonds were bid on the back of NAB adopting a more

aggressive RBA call (cuts in both Oct & Dec) after Citi joined the Oct cut camp

earlier in the day.

- YM & XM +3.5, leaving YM/XM at 31.5 and the cash equivalent at 28.0bp.

- Growing calls for RBA easing have manifested themselves in the AU/U.S. 10-Year

yield spread, now at ~-75.0bp, back from the ~-50.0bp level seen a couple of

weeks ago (also helped a little by a benchmark switch in Aus).

- Next week's AOFM issuance schedule is pretty normal, with the addition of a

A$100mn I/L Bond tap.

- Bills unch.-4 ticks higher thru the reds.

- The IB strip is pricing a near 85% chance of an RBA cut in October. RBA

Governor Lowe's speech, scheduled for this coming Tuesday, will be key.

- Vacancy data and flash PMIs headline the local economic data docket next week.