The space has moved in lockstep with...>

AUSSIE BONDS: The space has moved in lockstep with US Tsys, trading away from

Friday's session highs as US President Trump sounded a little more upbeat on the

potential for a US-China trade deal over the weekend. Elsewhere reports

suggested that North Korea is willing to come to the table to discuss

denuclearisation with the US.

- 3-Year bond futures last trade at 97.840 (+1.0 tick) while 10-Year Bond

futures last trade at 97.325 (-0.5 tick).

- The domestic 3-/10-Year yield differential trades at 52.2bp (+1.2bp) as the

grind away from last week's flats continues, while the AU/US 10-Year yield

spread has narrowed to -13.5bp (+2.5bp).

- 3-Month BBSW fixed 0.5bp higher which pressured the front end of the Bill

strip, with the front 3 contracts lower & the remainder of the white and red

contracts catching up later in the session to trade unch. to a tick lower.

- 10-Year bulls retain focus on the YtD high (97.4400) with a close above needed

to target 97.4658-5200 where key WMAs are situated. Bears now need a close below

the 200-DMA (97.2905) to ease bullish pressure.