Westpac have noted the following re:...>

AUSSIE BONDS: Westpac have noted the following re: the 10s/30s ACGB yield

spread: "if curve shifts were all about supply and inflation fears, then higher

yields should lead to steeper curves. However, that is clearly not the case.

Indeed, more often than not, especially in more recent weeks, the relationship

has been inverse, as might be expected given that the 10yr maturity is more

liquid and a better price discovery point. There has been one shift in the

relationship. For every level of 10yr bond yields, the 10-30yr curve is steeper

than history suggests it should be. That suggests that "supply premium" is

already in the curve shape, and should slow dramatic steepening off current

levels."