The trade "mood music" surrounding.....>

AUSSIE BONDS: The trade "mood music" surrounding U.S. Comm Sec Ross' +ve

comments pressured the space in the first SFE session of the week, even with

some more questionable tones on the matter coming from other quarters.

- Aussie bond futures gained some brief respite from softer than expected

domestic retail sales data, before edging lower again, with XM breaking through

its SYCOM lows late in the day & curve steepening at the fore.

- YM finished 4.5 ticks lower on the day, with XM -8.0 ticks, leaving YM/XM at

35.5 and the cash equivalent at 34.3bp.

- Bills settled 1-5 ticks lower through the reds, with the strip steeper on the

day

- Focus now moves to the rhetoric employed at tomorrow's RBA decision, with all

of those surveyed by BBG looking for the cash rate to be left unchanged at 0.75%

and the IB strip pricing a ~6% chance of a cut. Our full preview of the decision

will follow later today.