Core FI trade higher with escalating...>

BOND SUMMARY: Core FI trade higher with escalating tensions in the Mideast still

in focus. The weekend saw continued sabre-rattling from U.S. & Iranian leaders

and Iran raising a red "flag of revenge" from a major mosque & dropping its

commitment to limit uranium enrichment, while the Iraqi parliament recommended

expelling U.S. troops from the country drawing U.S. Pres Trump's ire. Elsewhere,

China's Caixin services PMI deteriorated more than exp., lending fresh support

to the space. T-Notes +0-06 at 129-18+. Cash Tsy yields trade 1.2-2.4bp lower

across the curve. Eurodollars last seen +0.75-2.5 ticks through the reds.

- JGB futures have added 40 ticks and sit at 152.58 (just shy of highs) as

Japanese participants come back from the domestic holiday. Today's round of 1-5

& 10-25+ Year Rinban ops saw no changes to purchase sizes, while a slight

downgrade to Dec Jibun Bank m'fing PMI has been shrugged.

- In Australia, YM +3.5 & XM +4.5 at typing. Cash yield curve has bull

flattened, yields sit 3.3-4.9bp lower. Bills last seen 2-4 ticks higher through

the reds. The local AiG m'fing PMI & CBA services/composite PMIs (f) all

improved, but remained in contraction.