Heading in to the close Aussie.........>

AUSSIE BONDS: Heading in to the close Aussie 10-Year bond futures trade 7 ticks

lower at 97.085, with the cash equivalent yielding 2.921%, while 3-Year futures

trade 3 ticks lower at 97.84.

- The AU/US 10-Year yield spread briefly turned negative, as the US 10-Year

yield consolidated above 2.9% following yesterday's US CPI release. A soft

breakdown in the latest Aussie labour market report helped cap Aussie yields, as

US 10-Year note futures were subjected to two relatively active bursts of

selling during the session, before we edged away from worst levels in the space.

- Aussie bond futures moved away from best levels as the spread moved back in to

positive territory, while the 90-day bills operated within a narrow range, as

the white contracts stuck to their SYCOM ranges.