Fixed income assets continue to be.....>

AUSSIE BONDS: Fixed income assets continue to be underpinned by the global trade

backdrop after the U.S. Tsy confirmed that the prev. announced tariffs on China

were scheduled to go into effect (at midnight ET), with U.S. President Trump

noting that he is eyeing up another $16bn in China tariffs in the coming weeks.

Markets now await China's response. - Outright Bond futures had been operating

around the recent highs, before the AOFM's announcement that, subject to market

conditions, a new 21 May 2041 Treasury Bond is planned to be issued via

syndication in the week beginning 16 weighed on the longer end of the Aussie

curve.

- The domestic 3-/10-Year yield differential & the AU/US 10-Year yield spread

are hovering around familiar territory, although the AU/US spread has moved away

from session lows following the aforementioned AOFM announcement.

- 3-Month BBSW fixed unchanged today, following 5 consecutive lower fixings, but

a surge in repo rates has pressured the Bill strip, with the white contracts

underperforming, last 2-3 ticks lower.