YMZ8 & XMZ8 continue to sit back.......>

AUSSIE BONDS: YMZ8 & XMZ8 continue to sit back from best levels after the softer

than expected GDP data propelled the contracts higher, allowing them to

challenge YtD highs based on continuation charts, with 10-Year yields briefly

sitting at fresh YtD lows as a result. The soft GDP print came after

constructive trade rhetoric from China's MOFCOM allowed the contracts to edge

back from opening levels. In BBG headlines MOFCOM noted that "China is to push

forward with U.S. trade negotiations over the 90 day period." MOFCOM stressed

that the trade meeting was "very successful" and that it is "confident that it

can execute the trade talk results." More balanced commentary from U.S.

President Trump via TWTR tempered the move pre-GDP.

- 3-/10-Year cash yield differential at ~53.0bp, off early flats.

- Today saw a lacklustre auction of a XMZ8 basket bond.

- The Bill strip is flatter, Reds have edged back from highs, with the white &

reds 1 tick lower to 4 ticks higher. 3-Month BBSW fixed ~0.3bp higher today.

Focus on year end funding. IB buying activity was also noted during the session.

- Focus now moves to an address from RBA's Debelle, due tomorrow.