Core bonds remain underpinned in the...>

BOND SUMMARY: Core bonds remain underpinned in the wake of the latest round of

Fed communique, which has left a July rate cut firmly on the table, in turn

providing the driving impetus overnight. T-Notes last 0-05 higher at 127-19,

with the 3-5 Year sector of the curve outperforming at the margin after

yesterday's twist steepening. A couple of block trades were noted overnight,

with a 10.0K of the FVQ9 118.00 calls blocked (sources pointed to a seller),

while 5.0K of the TYQ9 128.25 calls were blocked (also looked like a seller).

Screen trade also saw some decent flow in the TYQ9 128.25 calls with over 15.0K

trading (pre-block). Eurodollar futures trade 1.0-2.5 ticks higher on the day.

- JGBs bull flattened, with futures last dealing 11 ticks higher on the day, a

little shy of best levels. In all honesty there was little on offer on the

domestic front.

- In Australia YM & XM both sit 1.0 tick back from best levels, 2.5 and 1.5

ticks higher on the day respectively, with the curve sitting a touch steeper as

a result. Bills deal 1-3 ticks higher through the reds.

- German FI a touch higher; Schatz +2.0, Bobls +2.0, Bunds +12.