ING on on Wednesday's Refunding.............>

US TSYS: ING on on Wednesday's Refunding announcement: "On the one hand, this is

a record high for the 3yr, 10yr and 30yr mid-month instalment. On the other, it

is not a massive uplift from the $84bn that has typically been done. The nuance

is the extra issuance in the longer tenors, and moreover an extra $20bn to be

done in a new 20yr, as a separate exercise a week later."

- "While pressure for high long tenor rates makes sense if there is more supply

being pushed out there, it is also important that it does not become a

persistent pressure. Low rates are part of the solution here. Cheap funding

costs are a requirement for all players, and the US Treasury curve sets the base

funding cost."

- "Given the dis-inflation environment that we have, there is no huge risk here.

But at the same time, it is one that needs monitoring. For now, the most likely

outcome is a moderately steeper curve from the back end, with the 2yr still

anchored on the front end (in fact still could get to zero before we're finished

with this mess)."