Exceedingly quiet start to shortened...>

US TSY FLOWS: Exceedingly quiet start to shortened Christmas holiday week, Tsy

futures weaker across the board, just off second half lows on light volumes

(TYH<540k). 

- Mkts very thin, light two-way positioning with little react to weaker than

expected new home sales data. Futures had already scaled back from early session

highs as have equities (ESH0 +1.25). Doesn't take much for someone with an ax to

grind to push markets around.

- US Tsy $40B 2Y Note auction (912828YZ7) awarded a 1.653% rate (1.601% prior)

vs. 1.650% WI, bid/cover 2.30 vs. 2.63 previous.

- Limited swap flow with payer unwinds in long end from real$.

- The 2-Yr yield is up 1.9bps at 1.6481%, 5-Yr is up 1.7bps at 1.7472%, 10-Yr is

up 1.1bps at 1.9276%, and 30-Yr is up 1.3bps at 2.3552%.