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Choppy day for rates in lead up.....>

US TSYS SUMMARY
US TSYS SUMMARY: Choppy day for rates in lead up to Fri's May NFP (+194k est).
Limited reacts to US data, rates continue to react to Italian bond & political
headlines and US$ moves. Shorts press on increased rate hike chances past Jun.
- Tsys opened weaker on another day of relief for Italian bonds (2Y vs. Bunds
-44.1, 5Y -31.1); traded higher midmorning as US$/Yen slips lower (-.24, 108.67)
while Italian bonds vs. Bunds are moving off lows (10Y near steady). Tsy bid
evaporated midday on headline "FIVE STAR, LEAGUE AGREE ON GOVT TEAM" Bbg w/10YY
back over 2.8622%. Midday flow: fast$, program sellers chased bids before they
were cancelled on the Italy headline induced sale. Long end rebounding last
couple minutes, real$ +30s. Curve flatteners, steepener unwinds in in 2s and 5s
vs. 10s and 30s. Cautious positioning ahead Fri's May NFP.
- USD index near steady (DXY +.041, 94.110; US$ vs. Yen -0.17, 108.74); stocks
weaker (emini -12.25, 2712.25); gold firmer (XAU +0.60, 1302.00); West Texas
crude weaker (WTI -1.09to 67.12). Fed Brainard takeaway: hawkish
- Tsy cash/ylds: 2Y 100-04.3 (2.427%), 5Y 100-10 (2.681%), 10Y 100-10.5
(2.835%), 30Y 102-16 (2.997%).

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