Late Wednesday saw TD Securities.......>

AUSSIE BONDS: Late Wednesday saw TD Securities recommend buying ACGB 12/21s vs.

selling ACGB 04/25s at 13.0bp, with a target of 20.0bp and a stop at 11.0bp. The

expected holding horizon for this trade is 1 month.

- TD wrote "the ACGB 12/21 - 04/25 spread is currently near the lows. Our fitted

curve model indicates the ACGB 04/25s are 2.1 standard deviations rich while the

ACGB 12/21s are 1.9 standard deviations cheap vs the 6-month average deviations

from fair. The ACGB 04/25s rarely trade more expensive than current levels vs

the 12/21s, currently 1.25bp thru fair. Historically this curve spread has

steepened whenever ACGB 04/25s trade ~1bp through the fair spread to the 12/21s

as shown in the table below. There is 1.7bp of negative carry over 1-month on

this steepener."