Westpac highlight that "if anything,...>

AUSSIE BONDS: Westpac highlight that "if anything, the focus on these funding

rates has only intensified, with short-end Bills-Libor spreads widening out to

record levels, implied overnight FX swap funding surging as much as 200bp above

cash on some days, and overnight and term repo rates exhibiting high volatility

at elevated levels. The one sign of "relief" has been in 3m BBSW, which at 2.02%

is the lowest it has been since 5 June, but even that is still 52bp above 3m-OIS

implied cash. There is a growing view that these rates reflect a fundamental

shift in the supply and demand dynamics for AUD funding, and that the "new

normal" will be higher spreads to current cash rates."