*** After trimming losses into......>

US TSYS SUMMARY: *** After trimming losses into the auction, Tsys rallied on

strong $12B 30Y re-open auction, 2.30% stop through to a 2.867% rate, bid/cover

of 2.74 (highest since Dec 2014). Curves well off early steeper levels/flatter.

Equities stronger (emini +13.75, 2764.25), gold stronger (XAU +6.4, 1323.32),

oil well off highs (WTI +0.01, 6.58 vs. 64.77H).

- Early chop, Tsys indicated higher into open, reversed course on ECB headlines

that guidance could gradually shift in 2018. Rates had corrected higher after

word Wed's after Bloomberg sources story China would slow/halt Tsy purchases

denied by China offcls. Rates had already recovered from sharp bear curve

steepener late Wed, surged in evening.

- Rates recovered slightly on weaker than exp PPI, supportive of short

end/steeper curve with participants not anticipating a blow-out figure for Fri's

CPI (0.1% est vs. 0.3% high-side rumor. Flow included moderate two-way trade

ahead midday, positioning ahead Fri's CPI, deal- and auction-tied hedging in the

mix, some sporadic scale-in 5s30s flatteners by props.

- Late ylds: 2Y 1.973%, 3Y 2.084%, 5Y 2.314%, 7Y 2.454%, 10Y 2.531%, 30Y 2.867%