The curve has flattened, with..........>

AUSSIE BONDS: The curve has flattened, with futures following Tsys higher on

SYCOM, and operating just shy of early session highs last. 10-Year future

outperformance on the flattener saw the contract briefly trade through

Thursday's session high. YM last trades unch., with XM +2.0 tick, YM/XM sits at

48.5, with the cash equivalent at 47.0bp.

- The U.S.-China trade talks yielded little firm progress, but tones were

generally warm, although U.S. TR Lighthizer noted that there is still much to

do. Trump tweeted that there will be no firm deal until he meets with Chinese

counterpart Xi, which was proposed by Chinese representatives. Trump also wants

"a big trade deal" or it will be postponed. Xi stressed that he hopes that both

sides can meet each other half way. There is talk of up to 2 meetings between

the superpowers in the pipeline ahead of the Mar 1 tariff deadline. IP matters &

ind. subsidies remain key stumbling blocks, as well as enforcement of any deal.

- Bills +1-2 ticks across the whites & reds. RBA repo ops saw $1.25bn worth of

20-Day ops dealt at 2.037%, with $1.095bn worth of 49-Day ops dealt at 2.031%.

- Immediate focus on 2037 Bond supply & the weekly AOFM issuance schedule today.