Modest 2-way flow noted in the space...>

AUSSIE BONDS: Modest 2-way flow noted in the space in the wake of the RBA MonPol

decision, leaves bond futures a little higher vs. pre-announcement levels.

- Little in the way of notable changes to the broader brushes of the RBA's

rhetoric as the Bank tipped its cap to the softer than expected Q4 data and

recent developments in global markets.

- The Bank continues to hang its hopes on the strength of the domestic labour

market.

- The Bank also noted that underlying inflationary pressure has taken longer

than exp. to develop.

- On household consumption the RBA pointed to a "protracted period of weakness

in real household disposable income and the adjustment in housing markets."

- The Bank noted that it will continue to monitor developments.

- YM last -0.5 tick, with XM -2.5 ticks. YM/XM trades at 45.5, with the cash

equivalent at 40.9bp. The AU/U.S. 10-Year yield spread trades at -65.2bp.

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