The space has consolidated around......>

AUSSIE BONDS: The space has consolidated around the SYCOM closing levels, after

a brief uptick at the SFE open. 3-Year Bond futures last trade at 97.880 (+4.0

ticks), while 10-Year Bond futures trade at 97.380 (+5.0 ticks). The space

garnered a bid in SYCOM dealing as US Tsys ran higher alongside a sell off in US

equities. The domestic 3-/10-Year yield differential trade 0.4bp steeper at at

56.2bp, while the AU/US 10-Year spread has narrowed by 1.6bp to -18.0bp.

- The space digested a decent enough auction of a 10-Year basket constituent.

- 3-Month BBSW fixed 2bp higher today, which has led to IRM8 trading at

unchanged levels, while the remainder of the white & red Bill contracts are 2-4

ticks higher. Funding pressures remain front & centre running in to quarter end.

- Domestic focus is now well & truly on next week's RBA MonPol decision, which

will follow the elongated holiday weekend. On the wage front BofAML noted that

during a recent visit to Australia, most clients did not expect labour market

strength to translate to higher wage growth for now. The broader risk tone is

set to drive the Aussie fixed income space for the remainder of the week, with a

lack of economic risk events apparent.