A tight re-open for T-Notes, last +0-01+....>

US TSYS: A tight re-open for T-Notes, last +0-01+ at 129-10+. The contract

finished higher Tuesday, with modest bull flattening of the curve. Focus fell on

funding matters for a 2nd day, with the swings in repo & the subsequent movement

in the EFFR resulting in the NY Fed re-opening its overnight repo ops for the

1st time since the GFC. The NY Fed noted that there will be another $75bn round

of overnight repo ops tomorrow "to help maintain the FFR within the target

range." Tuesday's ops saw some slight delays, on the back of tech difficulties,

with $53.1bn/$75bn on offer allotted. Some noted undersubscription was likely

owing to most of the day's o'night borrowing being completed well before the Fed

executed. Oil mkt dynamics also helped to create some vol as Saudi noted that it

expects full production capacity to be restored in weeks, rather than months,

initially per source reports & subsequently through official comments.

- The Fed's MonPol decision dominates the global docket Wednesday, with most

looking for a 25bp cut. Funding market dynamics will heighten the focus on any

comments surrounding liquidity provisions, particularly re: the standing repo

facility, although it is highly unlikely that such a facility will be ready yet.