Australian bond futures stuck to a.....>

AUSSIE BONDS: Australian bond futures stuck to a tight range during the early

part of the SFE session, looking through local data and the latest ACGB bond

auction in the wake of RBA Governor Lowe's testimony.

- That was before the space turned sharply bid on the back of the change in

Westpac's call re: the

RBA, with YM leading (+8.5 at the close) XM (closed +6.0), promoting some

steepening of the curve. YM/XM closed at 37.0, back from highs of 38.5. To

repeat, "Westpac now expects two rate cuts next year from the RBA with the cash

rate cut to 0.25% in June 2020. Quantitative Easing is also expected to begin in

the second half of 2020."

- Elsewhere, RBC now sees the RBA cutting the cash rate by 25bp in both Feb 2020

(same as previously) & in 2021 (new), and they look for QE to start in 2021

(new).

- Bills closed -1 to +9 ticks through the reds, as the strip flattened.

- Q3 CapEx data headlines the local docket tomorrow.