MONEY MARKETS-S.Korea swaps ease, futures up on cbank comments

* South Korean swaps ease after central bank comments

* Aussie bond futures rise on less aggressive rate hike view

* Dollar funding rates at new low

By Umesh Desai

HONG KONG, Aug 11 (Reuters) - South Korean swaps fell and bond futures rose on Tuesday after the central bank said the recent jump in money market rates was overdone while offering a note of caution about the economic recovery.

In Australia, bond futures rose and short-term OIS eased to reflect a more moderate view on interest rates after markets had priced in aggressive tightening in monetary policy reacting to surprisingly strong housing data on Monday.

Offering another sign that short-term money markets continued recovering, dollar funding costs in Asia fell to a new trough. The 3-month rates in Singapore SIUSDD=ABSG dipped to 0.47286 percent from 0.47667 percent tracking the overnight record low fixing in the London Interbank offered rate (Libor).

In South Korea, the yield on benchmark 5-year treasury bonds KR5YT=KSDA dropped 11 basis points to 4.88 percent by 0330 GMT, while September treasury bond futures KTBc1 jumped 30 basis points to 109.38, after the central bank chief's comments.

Interest rate swaps fell after Bank of Korea Governor Lee Seong-tae said "the recent rises in market interest rates can be said to be overdone".

One year swaps KRQMCD1Y=KMBC dropped about 8 basis points (bps) to 3.18 percent.

The swaps struck a peak of 3.32 percent last week, the highest since end-2008, as investors began factoring in higher chances of an increase in policy rates, after Asia's fourth biggest economy released better than expected economic data.

"Despite the improving economic outlook, there are clearly still some uncertainties ahead," said BNP Paribas analyst Angus To in a research note.

"It was therefore no surprise to see that the BoK has continued to stress its readiness to do what is needed to safeguard the recovery, although any further easing is now getting more unlikely," he said.

Australian rates also fell after a recent sell-off which had factored in an excessively aggressive pace of monetary tightening, according to some analysts.

Three-year bond futures YTTc1 rose 2 bps to 94.81, while 10-year bond futures YTCc1 were up 0.025 points at 94.33.

"Yes, We have seen the last of the rate cuts but the market is too hawkish," said Gerard Minack, strategist with Morgan Stanley.

"The market is leaning towards two rate increases by Christmas -- which I think is too aggressive," he said while adding that he did not expect a rate increase until 2010.

Five month and six month OIS AUDOIS eased, but one year OIS was higher.

Last week, the Reserve Bank of Australia shifted away from its easing bias and raised its growth forecasts, making clear rates could be expected to rise to normal levels over time.

Australia's cash rate is at a record low of 3 percent, having been lowered by 425 basis points between September and April. (Editing by Tomasz Janowski)