Softer than exp. Australian CPI data...>

AUSSIE BONDS: Softer than exp. Australian CPI data resulted in a flurry of

activity, with Australian yields tumbling as a result. YM last trades 16.0 ticks

higher on the day, with XM +10.0 ticks. YM/XM trades at 56.0 ticks, with the

cash equivalent at 51.0bp.

- Bills trade 12-18 ticks higher through the reds, as bets on RBA rate cuts were

rolled forward. Odds of a May cut now sit at 56% from a mere 12% yesterday

(based on OIS), with chances of at least one cut by year end priced at 90%.

- JPMorgan now look for back to back RBA cuts in May & June, with Citi also

pointing to a chance of such a move

- Repo operations saw A$860mn worth of 25-day operations dealt at an average of

1.790%, with A$1.146bn worth of 62-day ops dealt at an average of 1.786%.

- Australia will observe ANZAC day tomorrow, which may limit liquidity on

Friday.