Generally quiet at the start of the....>

US TSY FLOWS: Generally quiet at the start of the two-day FOMC policy meet. Tsys

extend session highs late, risk-off tone taking hold as eqs sold off/extend

session lows. Some program selling on latter, two-way in short to intermediate

Tsys w/ better buying from specs in belly.

- Markets pricing in 25bps hike from the Fed tomorrow with a dovish tone going

forward -- pain trade would be an unexpected hawkish hike from the FOMC,

equities surely to extend sell-off in that event.

- US$ index remains mildly lower, US$/GBP and US$/Eur higher/off early highs;

West Texas Crude hammered (WTI currently -2.53 at 47.35 vs. 46.97L).

- Swap spds tighter/off first half lows following decent rate and spd receiving

in 2s, over $1B nominal earlier, receiver flys include 2s5s10s and 2s4s5s.

Earlier, short end narrowing outpaced amid continued better receivers in 2s, 5s,

payer in 10s and a 2s/5s/10s receiver flys.

- Salient data for Wednesday: Existing home sales for Nov (5.17m est), FOMC annc

(1400ET), Fed Chair Powell press conf. Tsy cash/ylds: 2Y 100-06 (2.650%), 5Y

101-00 (2.654%), 10Y 102-18.5 (2.823%), 30Y 105-24 (3.079%)