Speculation surrounding and the........>

BOND SUMMARY: Speculation surrounding and the ultimate level of the USD/CNY fix

from the PBoC, which came in a whisker below the psychological CNY7.00 mark,

supported global core fixed income in Asia-Pacific hours.

- T-Notes last deal +0-15 at 130-07+, with the yield curve as touch flatter as

the long end modestly outperforms. Decent buying of USU9 164.00 and 164.50 calls

was flagged in early Asia trade. Eurodollar futures deal 2.0-5.5 ticks higher

through the reds.

- JGB futures were supported by the broader flows, which allowed them to extend

on their overnight recovery, although the contract failed to challenge the

recent all-time high, and last deals 19 ticks higher than settlement. The cash

curve witnessed some modest bull flattening.

- Aussie bonds drew further support from monetary policy goings on across the

Tasman as the RBNZ delivered a shock 50bp cut to its OCR, with further dialogue

surrounding work on extraordinary monetary policy measures noted. YM +6.0, XM

+9.0, leaving YM/XM flatter at 33.5. Bills deal 5-6bp higher through the reds.