*** Little surprising content in the......>

AUSTRALIA: *** Little surprising content in the RBA statement, as the bank left

its cash rate unchanged at 1.50%. The Bank has stuck to its glass half full

approach, and there was a lack of fresh dovish rhetoric that some were looking

for, with some of the comments more positive at the margin. The Bank didn't

change its language re: mortgage rates, despite the recent out of cycle rise

from Westpac or acknowledge the latest round of political upheaval/knock on

effects for biz confidence. The Bank noted that the economy likely grew at an

above trend rate in H118. The Bank also reiterated that the outlook for the

labour market remains positive and that there should be a further lift in wages

growth over time, after a little pick up recently, owing to reports of skills

shortages in some areas and high vacancy rate, with a further gradual decline in

unemployment still expected.

- AUD/USD has firmed on the release, hitting a high of $0.7224, resistance noted

at yesterday's high ($0.7224), followed by the 38.2% retracement of the move

from $0.7381 to $0.7166 ($0.7248). AU 3-Year Bond futures have eased 2.5 ticks

and are testing 98.00.