CORRECTION. US Treasuries were......>

US TSYS SUMMARY: CORRECTION. US Treasuries were largely stable in Asia as the

market sailed through the lack of progress in the roll-back of Obamacare.

- Strong German CPI data is inflicting considerable pain upon the European

markets, perhaps more than might be expected given that the State numbers are

running only a tenth of a percent stronger than pan-German expectations. The

slide in the Bund is being done on the back of high volumes -- at least for the

time of the week and year.

- The Treasury market is following some of the European movement and the 10Y UST

yield is 0.7bp higher at 2.32%; there is a little more weakness in the very

front end of the yield curve, particularly sub-1Y paper where some yields are

2-3bp higher.

- Concerns are building that the lack of movement in Obamacare could be

extrapolated to the debt ceiling negotiation. There is a clear underperformance

by Apr/Oct short-dated coupon paying Treasuries this morning. These Apr/Oct

yield movements have been greater in the shorter-maturity bonds, for

mathematical reasons.