MNI MARKET ANALYSIS: Aussie Bills......>

AUSSIE BONDS: MNI MARKET ANALYSIS: Aussie Bills Weekly Update

It has been another interesting week for the Bill strip, with the whites and

reds leading the way higher. The front end of the curve benefitted from easing

funding pressures. 3-Month BBSW has set lower for 21 consecutive days, and nears

levels not seen since March 2018. RBA repo ops still point to turn premium.

- The RBA meeting mins & Gov. Lowe's parliamentary testimony revealed little in

the way of fresh information.

- Thursday provided a strong labour market report, Westpac adjusted its RBA rate

call (now looking for 2 cuts, 1 in Aug & 1 in Nov), a RTRS sources piece

pointing to several MOU's in the pipeline that would address the structural

U.S.-China trade issues & reports of China's Dalian port banning Australian coal

imports. The bid that came on the back of the Dalian story was quickly unwound,

but the contracts across the strip still finished the week 2-5 ticks higher.

- IB's price in an 85% chance of a cut by year end.

- Focus remains on the U.S.-China trade situation, coal export matters, while

next week will see the release of the first Q4 GDP partials.