A tight re-open for T-Notes with the........>

US TSYS: A tight re-open for T-Notes with the contract last -0-02 at 129-00.

- Monday saw a bid (most of which occurred at the re-open) in the space owing to

the introduction of a wider geopolitical risk premium in lieu of the

well-documented weekend attack on the major Saudi crude facilities, with soft

Chinese economic data also lending support. U.S. President Trump stopped short

of laying the blame fully on Iran (despite his "locked and loaded" tweet), but

he did intimate that he believes that the Gulf state was behind the attack.

- Flow included deal-tied hedging on >$8bn worth of high grade issuance, real

money a/c buying of 10s and 3-Month/10-Year flatteners after the recessionary

indicator moved away from inverted lows over the past couple of weeks.

- Short-end desks noted the jump in O/N repo, which got a wider airing, but most

suggested that the surge was likely tied to corporate tax obligations & Tsy

auctions.

- Moving to Tuesday, production data provides the highlight of the local docket,

with the fallout from the weekend attacks on Saudi still front & centre pre-FOMC

(with the latest MonPol decision scheduled for Wednesday).