Flat Re-open For T-Notes

TYZ1 flat at the re-open, last +0-01+ at 131-11, after closing a little off session lows on Monday, sticking within Friday's range during the first session of the week.

• The cash Tsy curve twist flattened, with the belly leading the weakness as 5s cheapened by a little over 6bp, while 30s richened by ~0.5bp come the bell. The weakness in the front end/belly was aided by soft pricing in the latest 3-Year Tsy Note auction, tailing by 1bp, while the cover ratio held steady, a touch below the recent auction average. On a more constructive note, dealer participation cratered, falling back below the recent average. Higher crude prices helped drag breakevens wider. Much of Monday's Fedspeak pointed to steady views when compared to previous comments, but rate hike premium was still added back into the market, adding further weight to the belly of the curve.
• There is a lack of tier 1 headline risk events slated during Asia-Pac hours. PPI data headlines the domestic docket on Tuesday, with 10-Year Tsy supply and another raft of Fedspeak also due.