It was a lacklustre session for the....>

AUSSIE BONDS: It was a lacklustre session for the space. Bonds closed just off

of session highs, with little in terms of fresh catalysts to trade off of.

3-Year bond futures last traded at 97.885 (-0.5 tick) while 10-Year futures last

traded at 97.290 (+1.5 ticks).

- The domestic 3-/10-Year yield differential was around 1.2bp tighter at 66.2bp,

while the AU/US 10-Year yield differential is off of session wides, but is still

-2.9bp wider at 13.0bp. The RBA's steady hand is keeping a lid on rate

expectations in Australia, with little sign of the potential for any change in

tone from the central bank in the immediate future.

- 3-Month BBSW fixed 0.5bp higher today, after 3-Month US LIBOR fixed over 3.0bp

higher. The white Bill contracts traded unchanged to 1 tick higher on the day,

as today's fix lagged the jumps seen earlier this week.