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The Australian Office of Financial.....>

AUSSIE BONDS: The Australian Office of Financial Management (AOFM) will auction
A$600mln of 2.25% 21 May 2028 on Wednesday, issue #TB149 which is part of the
underlying basket for the 10-Year future (XMH8).
- The line was last sold on December 6 for A$900mln, the sale drew an average
yield of 2.5846%, a high yield of 2.5825% with 84.6% of bids at the high and was
covered 2.5889.
- The issue has A$23.9bln outstanding with a modified duration of 9.02 years.
- The AU/US 10-Year yield spread is last at 3.3bp, narrowing from a 2018 high of
28bp. The spread dipped into negative territory earlier this week, it has not
seen a sustained dip below zero since 2000. Wednesday's US CPI release could be
key for the spread's dynamic in the short term, after the RBA maintained a
dovish tone and the short end has repriced chances of a 2018 hike to 60% from
70% last week.
- Results due at 0000GMT/1100AEDT.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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