Bonds stuck to a tight range going.....>

AUSSIE BONDS: Bonds stuck to a tight range going out at worst levels, with

3-Year Bond futures closing at 97.865 (-3.0 ticks), while 10-Year Bond futures

finished at 97.385 (-1.0 tick).

- The domestic 3-/10-Year yield differential steepened by 0.5bp to trade at

54.2bp, while the AU/US 10-Year yield discount narrowed by 2.5bp, to -17.1bp.

- 3-Month BBSW fixed 0.5bp higher as repo rates jumped on the last trading day

of the quarter. The focus in the early part of April (outside of the RBA

decision) will be on whether or not the recent funding squeeze abates, with many

pointing to quarter end influences as a driving factor behind the recent move in

repo rates. The white & red Bill contracts finished 1-2 ticks worse off.

- For 10-Year futures, follow through has been lacking on fresh 2018 & 3mth

highs which increases the risk of a correction when combined with daily studies

at O/B levels and daily momentum divergence noted. Bears now look for a close

below 97.3550 to ease bullish pressure and shift focus back to 97.1750-2960

where key DMAs are situated. Bulls focus on 97.5000-5200 while 97.3550 supports.