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*** Getting a bunch of questions on why.....>

US TSYS
US TSYS: *** Getting a bunch of questions on why isn't the Tsys market improving
more after soft retail sales. Here's what we hear so far from traders: in some
cases, traders already do own in Tsys what they want to own (at least for now at
head of potential pre-weekend safe-haven bid), so they are just sitting tight
until later today. Some others however are under water on Tsys holdings and need
10-year note yields to push about 3-4 bps lower before they will take new
action. 
- Finally there was odd safe-haven bid trading (i.e., very muted) overnight due
to the Japanese holiday Monday, which spurred apparently light safe-haven bid
and then unusually swift safe-haven unwinds into the weekend.
- And finally the Q/E unwind prospect/taper/rate hike hints that could arise at
ext week's FOMC and need to get positions set up before then, could be limited
NY action today, at least so far. Some argue this tapering has already been
priced in. Others are bracing for a very choppy Wednesday amid 2pm ET FOMC news,
2:30pm ET Fed Chair Yellen news conference.

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