Bull flattening was the initial Tsy theme...>

US TSYS: Bull flattening was the initial Tsy theme in Asia after Thursday's

range breaks for both outright 10-Year yields and the 5-/30-Year yield spread,

although that has unwound, with yields now unch. to 1.0bp cheaper across the

curve as we move into European hours & risk-on flows pick up. Decent volume for

T-Notes again in Asia, with the contract pressing to fresh lows last -0-04 at

137-21+, with ~120K lots changing hands thus far. Some pointed to the

attractiveness of FX-hedged 30-Year Tsy yields to Japanese investors (highest

since 2017, topping 1.0%) as a potential catalyst for the early buying, while

the pullback was a broad based risk move, with no real headline driver.

- Familiar risks in the background, with a focus on today's NFP report, given

recent trend in the broader U.S. labour market data i.e. beyond the worst of

things in joblessness acceleration, but unemployment still ticks higher.

- A few block trades to highlight from overnight with an apparent 15.0K

liquidation in the TYN0 138.00 puts, as well as a 2.0K liquidation of the USN0

176.00/174.00 put spread and 25.0K worth of fresh long positioning in the TYQ0

137.50/136.50 put spread across 0-21/22.