Risk appetite remained healthy,........>

BOND SUMMARY: Risk appetite remained healthy, weighing on core FI. Yesterday's

positive showing from U.S. equity markets inspired their peers in Asia, while

participants greeted the latest round of positive comments re: trade talks with

China from U.S. Pres Trump. T-Notes trade -0-02 at 129-03; cash Tsy yields sit

1.0-1.7bp higher, the curve runs flatter. Eurodollars -0.5 to +0.25 thru reds.

- JGB futures sold off initially as local equity benchmarks hit fresh YtD highs.

However, after bottoming out just above a cycle low, the paper recovered & last

sits at 153.73, 17 ticks shy of settlement. A decent 2-Year JGB auction helped

sustain the move post-lunch; cover ratio was 4.81x vs. prior 3.75x. Yield curve

runs steeper at typing. Little attention given to a slight miss in Tokyo CPI.

- Aussie bond futures dipped; YM last -7.0 & XM -8.5. Aussie bond yields trade

6.8-7.8bp better off across the curve. Bills last seen 5-7 ticks lower thru

reds. In the local news, Australia's consumer watchdog sued Google over

allegedly misleading users. Across the Tasman, stories re: NZ Super Fund's

review of FX hedging policies & potential for removing +ve outlook from NZ S&P

rating were doing rounds. The focus turns to a speech and Q&A from RBA Gov Lowe.