The AOFM launched its new 2.75% 21.....>

AUSSIE BONDS: The AOFM launched its new 2.75% 21 May 2041 Treasury Bond, which

was expected at some point this week. The AOFM noted that "initial price

guidance for the issue is a spread of 39.5 to 44.5 basis points over the implied

bid yield for the primary ten-year Treasury Bond futures contract." Initially

the IPT generated little follow-through (as the guidance was in line with the

majority of estimates), but 10-Year futures have since made fresh lows, as the

20-Year sector dragged the space lower, before the complex stabilised and edged

back to near unchanged levels.

- The domestic 3-/10-Year yield differential last trades at 57.0bp.

- 3-month BBSW fixed 0.12bp higher today, with the Bill strip last trading

unchanged to 2 ticks softer after some early pressure.

- AUD cross currency basis swaps continue to move higher despite today's

stabilisation in funding rates.

- China GDP/activity data provided traders with little opportunity.

- The RBA July meeting minutes, due Tuesday, and domestic labour market report,

due Thursday, headline this week.