The space edged lower, playing.........>

AUSSIE BONDS: The space edged lower, playing catch-up to the relative

underperformance of U.S. Tsys during NY dealing. The domestic 3-/10-Year yield

differential & the AU/US 10-Year spread continue to operate around familiar

levels.

- 3-Month BBSW fixed 0.7bp higher this morning. Near term volatility in the repo

rate space also continues to garner attention after rates in the space picked up

yet again at today's operation. Bills last trade 1-3 ticks lower.

- AUD cross currency basis swaps are also feeling the pressure of the elevated

funding costs, this led to Mizuho Financial launching 5-Year paper, to take

advantage of the move in basis.

- Elsewhere ANZ has announced 3-Year benchmark paper, while QTC priced a tap of

its August 2030 line.

- The remainder of the week provides little in the way of domestic risk events,

so focus is likely to remain on the BBSW/repo space & the global risk

environment.