VIEW: HSBC note that their "bullish....>

AUSSIE BONDS: VIEW: HSBC note that their "bullish view on duration in Australia

is based on the idea that bond valuations look attractive amid a benign outlook

for short rates and the ongoing suppression of yield volatility. 10Y yields have

been stable over the past two months while both bond and swap curves have

steepened as ample liquidity and Yield Curve Control (YCC), centred on the

three-year bond, has held down the front-end. This dynamic has compressed

curvature on the AUD IRS curve to extremes around the five-year point: we think

it is only a matter of time before carryseekers are pushed to longer maturities.

Accordingly, we recommend entering 5-10Y AUD IRS flatteners with the slope close

to its steepest level since 2015."

- They entered this trade at 44bp today, targeting 30bp with a stop at 52bp.