Core FI space has inched higher,.......>

BOND SUMMARY: Core FI space has inched higher, amid a broadly cautious mood.

Investors are on the lookout for any news re: the resumed ministerial-level

U.S.-China trade talks. T-Notes last trade +0-05+ at 127-12+. Cash Tsy yield

curve has shifted a touch lower, with Eurodollar contracts trading 1.0-3.0 ticks

higher through the reds. Late on Friday, U.S. Pres Trump said that he "didn't

say he's not going to do something" on the dollar, while having a strong dollar

is " a beautiful thing." His comments left participants confused, as they hit

the wires after Trump's adviser Kudlow ruled out FX intervention.

- JGB futures are back to the settlement at 153.73. They have picked up a bid as

the Nikkei 225 slid, dragged lower by the electronics sector. Cash JGB yields

oscillate around unchanged levels. Muted reaction was noted to the release of

softer, but still better than exp. Japanese retail sales. Sankei reported that

PM Abe is unlikely to meet South Korea's Pres Moon in Sep.

- Aussie YM last sits +4.0 ticks, with XM +3.5 ticks. Cash yields are 3.4-4.2bp

lower across the curve, having extended losses after playing catch-up to U.S.

Tsys at the open. Bills are unch. to 4 ticks higher through the reds.