Action Limited In Asia After Month-End Vol.

T-Notes continue to operate within the confines of a very narrow 0-02+ range, looking through the latest round of Chinese Caixin m'fing PMI data, which came in on the softer side. The contract last deals -0-06+ at 132-09+. The major cash Tsy benchmarks trade little changed to 1.0bp cheaper on the day, with Asia-Pac activity hindered by a lack of meaningful headline flow and the observance of a holiday in Hong Kong.

• As a reminder, Tsys unwound their gains/flattening over the late NY month-end period on Wednesday, with the major cash Tsy benchmarks hitting the bell around unchanged levels. Local data releases included a mixed ADP print (beat on this month's reading, with the prior month's reading seeing a ~92K downward revision), while the rate of expansion witnessed in the MNI Chicago PMI slowed at a quicker clip than was expected. 2x TU/FV flattener blocks were seen during the NY morning, helping the general flattening trajectory that was evident ahead of month-end flows. There was also a 10K block buy in the TYU1 135.00/136.00 call spread, with the 136.00 strike equating to a drop to ~1.00% in yield terms. Short end activity once again caught the eye, with the increased round of EDZ2/Z4 activity continuing for a third day. A reminder that Morgan Stanley issued a recommendation to initiate EDZ2/Z4 steepeners at 104.0 after hours on Friday, with the spread operating in a 101.5-107.0 range so far this week, ending NY trade at 105.5 (after settling at 102.5) with ~86K lots trading since Sunday's Asia-Pac open. Fed reverse repo facility activity also garnered attention, surging to $992bn at quarter-end.
• Global PMI data will be front and centre ahead of Thursday's NY session, although a fair chunk of the releases represent final prints. Looking ahead to NY hours, the local docket will be headlined by the latest ISM m'fing survey and weekly jobless claims data.