The soft internals evident in the......>

AUSSIE BONDS: The soft internals evident in the latest round of Chinese trade

data drove bond futures to fresh intraday highs, after a very limited start to

the week. The move allowed the front contracts to clear their respective Friday

highs. YM & XM trade 3.0 higher with YM/XM at 51.0 and the cash 3-/10-Year yield

differential dealing at 48.0bp.

- The auction of a non-basket Bond was largely ignored.

- White and red Bills continue to hold flatter on the day, unchanged to 3 ticks

higher at writing, with the soft Chinese trade breakdown allowing the front end

of the strip to unwind its early (likely funding pressure related)

underperformance. Modest ticks higher noted in RBA repo op rates and the 3-Month

BBSW fix today. RBA reverse repo operations saw A$1.375bn worth of 21-Day ops

dealt at 2.046%, with A$1.046bn worth of 71-Day ops dealt at 2.041%.

- Lower tier AU data due this week, so broader risk themes including China,

Brexit & Fedspeak are likely to drive activity.