Bond futures trade a touch off of......>

AUSSIE BONDS: Bond futures trade a touch off of highs, underpinned by the

broader risk off flows observed earlier in the session, which had no clear

catalyst (a weaker Nikkei 225 seemed to provide the initial impetus for the

broader flows), with soft Chinese activity data adding a fresh bid in the middle

of the session. YM/XM last 47.25, with the cash 3-/10-Year yield differential

last ~47.0bp. This area has acted as a double bottom for the cash curve over the

last 12 months. AU/U.S. 10-Year yield spread last -44.5bp.

- White and red Bills trade 1 tick lower, to 2 ticks higher last. Funding

matters have pressured the front end, with the reds more responsive to the risk

off flows observed earlier in the day. Focus continues to fall on year end

matters in the shorter dated rates space, with the RBA's 31-day reverse repo

operations conducted at 2.228% today, on a healthy enough A$2.22bn. 3-Month BBSW

set 1.68bp higher at 2.0166% today.

- Next week will bring the RBA's Dec meeting minutes on Tuesday, ahead of next

Thursday's AU labour market report. Markets also eye the AU gov't MYEFO, due

Monday.