The space has edged higher in SFE......>

AUSSIE BONDS: The space has edged higher in SFE dealing, with 3-Year Bond

futures last trading 1.0 tick higher at 97.790, while 10-Year Bond futures trade

1.5 ticks softer at 97.215. The space moved to session highs after Fitch

affirmed Australia at 'AAA'; outlook stable & the Washington Post reported that

US Special Counsel Mueller raised the possibility of a presidential subpoena in

a tense meeting with Trump's legal team.

- Late on Tuesday RBA Gov. Lowe noted that "our central scenario is for a

gradual pick-up in wages growth, a gradual lift in inflation & a gradual

reduction in the unemployment rate. The Board's view is that while this progress

is occurring, the best contribution we can make to the welfare of the Australian

people is to hold the cash rate steady & to be a source of stability &

confidence. If things turn out as exp., it is reasonable to exp. that the next

move in interest rates will be up.".

- The domestic 3-/10-Year yield differential is 2.3bp steeper at 59.3bp, while

the AU/US 10-Year spread trades at -20.2bp. The white & red Bill contracts are 1

tick higher. Participants await the auction results of the March 2047 Bond.