The domestic curve flattened heading...>

AUSSIE BONDS: The domestic curve flattened heading in to FOMC, pressuring trade

recommendations out of various banks who have suggested entering different

steepener expressions, with some evidence of unwinds in play.

- 3-Year Bond futures closed at 97.825 (-3.5 ticks), while 10-Year Bond futures

closed at 97.285 (unch.).

- The domestic 3-/10-Year yield differential last traded at 61.1 bp, 2.6bp

flatter on the session.

- US cash Tsys were closed during the Asia-Pacific session owing to a Japanese

holiday, but the 10-Year AU/US yield differential sits just above -20bp, heading

in to tonight's FOMC decision.

- 3-month BBSW fixed 1bp higher today, after yesterday's pause in the march

higher, with the Bill strip sitting 2 ticks lower across the white contracts at

the close, with sell side flow apparent in late SFE dealing. BBSW & repo rates

will be closely watched heading into the end of the quarter following the recent

grind higher.