The space meandered along in a.........>

AUSSIE BONDS: The space meandered along in a range-bound session. 3-Year bond

futures finished a tick lower at 97.875, while 10-Year futures also traded a

tick softer, closing at 97.280.

- The domestic 3-/10-Year yield differential last traded at 68.4 bp, virtually

unchanged on the day.

- The AU/US 10-Year spread trades around 1.9bp wider at 14.7bp.

- The latest auction of a 10-Year basket bond was well absorbed, with demand

supported by the fact that the line is being viewed as the "de-facto" benchmark

bond. This helped the auction to pass smoothly, despite the increase in size

when compared to the line's most recent issuance (although the cover ratio did

creep lower). The AOFM's buyback operations were also well digested by markets.

- 3-Month BBSW fixed 0.5bp higher today. The white Australian Bill contracts

traded unchanged to 2 ticks lower.

- From a technical perspective 10-Year futures are hesitating around the 200-DMA

(97.305) with the 55-WMA and Bollinger top lurking above. Bears now need a close

below 97.2350 to ease bullish pressure.