The space has edged back from the......>

AUSSIE BONDS: The space has edged back from the opening highs and continues to

track Tsys after rallying during the SYCOM session on the back of broader risk

off flows.

- The domestic 3-/10-Year yield differential & AU/US 10-Year yield spread

continue to operate around the recently observed levels.

- The 3-Month BBSW fix edged away from the multi-year highs that were observed

yesterday, fixing 1.35bp lower today. This has resulted in the Bill strip

trading a touch firmer with the white and red contracts unchanged to 2 ticks

higher last, as the lower fix supports.

- The market digested an auction of the longest Bond on the AOFM's books, the

Mar 2047 line. The cover ratio ticked higher, although the size of the auction

was smaller than the prior.

- The Australian docket looks very limited over the next week, so focus is

likely to fall on the broader risk environment.