It has been a relatively volatile......>

AUSSIE BONDS: It has been a relatively volatile session for the space with Bond

futures last trading unchanged to slightly higher on the day.

- YM last +0.5 tick, with XM +1.5 ticks. YM/XM trades at 44.5, with the cash

equivalent at 44.0bp.

- The space initially took a hit on the back of a much stronger than expected

domestic labour market report. The reading will please the RBA, as it continues

to look to the strength in the labour market as a source of solace, noting that

the health of the labour market provides a contrast to other areas of the econ.

- Bonds then recovered, registering fresh highs after Westpac became the first

of the big 4 to forecast further cash rate cuts from the RBA. Westpac now look

for the Bank to cut its cash rate in both August and November of this year.

- The space then moved back towards neutral levels on the back of a RTRS sources

piece which suggested that he U.S. & China are drafting 6 MOUs on key structural

issues including IP, services, tech transfer, agriculture, currency & non-tariff

barriers in their trade talks.

- Bills trade unchanged to 3 ticks higher through the reds.