Rates trade weaker, inching off.....>

US TSYS SUMMARY: Rates trade weaker, inching off lows on moderate volume

(TYM<875k) following $25B 10Y auction awarded 2.995% rate (2.795% in April after

March auction awarded 2.889%); 10YY tappd 3.0117% O/N.

- US$ index paring recent gains (DXY -.058, 93.062; US$/Yen 109.691); equities

stronger (emini +23.0, 2693.25) as West Texas crude vaults to new high of 71.36

(late 2014 lvls), currently +2.20, 71.26; gold weaker (XAU -1.80, 1312.74).

- Pretty quiet trade on net, focus on Thu's CPI (0.2% m-o-m/est) after this

morning's PPI climbed 0.1% -- suggests inflation slowed a bit after a strong

March showing; Mar wholesale inv +0.3%, below the +0.5% in the adv est. Atl Fed

Pres Bostic: inflation likely to run above 2% "for a while". Bostic added that

concerns of trade war between US and allies were "overshadowing" positive effect

of "tax cuts".

- Two-way flow after better early selling in long end, modest deal-tied flow,

pre-auction short set/unwind. Decent option volume on mixed trade that favored

downside put buying over calls, particularly in late 2020 sector of curve. 

- Tsy ylds: 2Y 2.524%, 3Y 2.677%, 5Y 2.831%, 7Y 2.950%, 10Y 2.997%, 30Y 3.147%