Mostly higher/curves flatter,.......>

US TSYS SUMMARY: Mostly higher/curves flatter, choppy ahead Fri's May NFP (+194k

est). Limited data reacts, rates continue to react to Italian bond & political

headlines and US$ moves. Shorts press on increased rate hike chances past Jun.

- Tsys opened weaker on day two of relief for Italian bonds (2Y vs. Bunds -44.1,

5Y -31.1); traded higher midmorning as US$/Yen slips lower (-.24, 108.67) while

Italian bonds vs. Bunds are moving off lows (10Y near steady). Tsy bid

evaporated midday on headline "FIVE STAR, LEAGUE AGREE ON GOVT TEAM" Bbg w/10YY

back over 2.8622%. Midday flow: fast$, program sellers chased bids before they

were cancelled on the Italy headline induced sale. Long end rebounding last

couple minutes, real$ +30s. Curve flatteners, steepener unwinds in in 2s and 5s

vs. 10s and 30s. Cautious positioning ahead Fri's May NFP.

- USD index lower late (DXY -.101, 93.968; US$ vs. Yen -0.25, 108.65); stocks

weaker (emini -16.5, 2708.0); gold softer (XAU -.56, 1300.84); West Texas crude

weaker (WTI -1.11 to 67.10). Fed Brainard takeaway: hawkish

- Tsy cash/ylds: 2Y 100-05.2 (2.411%), 5Y 100-12 (2.668%), 10Y 100-12.5

(2.828%), 30Y 102-19 (2.992%).