Futures sold off on the back of the....>

AUSSIE BONDS: Futures sold off on the back of the AU labour market report, with

a much stronger than expected headline reading of +32.8K jobs added, with

marginally +ve revisions, meaning that the unemployment rate held steady at 5.0%

vs. exp. for an uptick to 5.1%. Furthermore, the additions were solely driven by

full time jobs growth. YMZ8 breached its November 12 low in the process but

failed to challenge the contract low, with futures now hovering off of session

lows.

- Wage growth remains the missing part of the puzzle for the RBA, with firms

seemingly more interested in adding remuneration via bonuses, instead of

committing to larger wage increases, at least for the time being.

- AU Bonds extended their recent underperformance vs. Tsys on the back of the

release, with the AU/U.S. 10-Year spread at ~-40.0bp last, while the domestic

3-/10-Year yield spread briefly flattened below 60.0bp.

- Bills trade 1 to 5 ticks lower, with 3-Month BBSW setting unchanged today.

- Focus now turns to the AOFM's weekly issuance schedule, due tomorrow.