During SYCOM Fed Yellen made...........>

AUSSIE BONDS: During SYCOM Fed Yellen made slightly hawkish remarks, she said

inflation uncertainties call for gradual rate moves but hiking too slowly risks

an overheated labour market, this initially caused Aussie futures to dip then

bounce alongside Tsy's. As investors retreated away from safe havens Tsy's ended

the overnight session weaker, as did the Aussie 3 and 10-Years. 

- Coming into SFE the two benchmarks came up by 2 ticks but following buyback

announcements and auction results in at higher yields than previous on the same

line both contracts came down, Pres. Trump then said the U.S is 'totally

prepared' for second option of military action on N. Korea but stated this would

be 'devastating,' steadying the contracts, the 3-Year last flat at 97.830 and

the 10-Year last down 1.5 ticks at 97.185.

- Yields up across the curve, 3-Year up 0.4bp and 10-Year up 1.7bp - wide 1.3bp

spread.

- No domestic data today but looking to Aug job vacancy figures coming in

tomorrow at 0230BST as well as a talk from RBA Debelle in London scheduled for

1000BST.