A fairly modest start to the week...>

US TSYS SUMMARY: A fairly modest start to the week for the US Treasury market.

The 10Y UST yield is 1bp lower relative to Friday's NY close and is currently

2.855%. The 5-7Y section of the yield curve is leading the move lower in yields

with a 1.5bp decline.

- The 10Y Bund-Tsy spread has moderated to 220bp, having been close to multi

decade highs at the back end of last week.

- Futures contract flows are being inflated by heavy contract roll activity.

First notice the contracts is Wednesday and most contracts have around 50% of

rolls done.

- Summing along all US contracts, the Commitment of Traders Report showed that

the net levered position is now at its largest ever at a massive $259bln of 10Y

equivalents. Most of the recent levered shorts have been implemented in the

euro$ contracts.

- This week's main event in the US Treasury market is the new Fed Chair's first

Testimony on the Hill, which takes place on Tuesday. There is no coupon supply

this week.