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*** Risk-off, risk-on back to.......>

US TSYS SUMMARY
US TSYS SUMMARY: *** Risk-off, risk-on back to risk-off again. Desks cited
chatter from Japan on N Korea gearing up for another missile test (out earlier)
spurred recent safe-haven bid in 10s and 30s. Gold surged (XAU +8.5 1297.30),
US$ near lows vs. Yen (110.862) Tsys have rebounded, trades mildly higher on
two-way flow heading into Tsy auctions (dual 2- and 5Y note supply to avert
month end issues.) strong 2Y drew 1.765% rate, 60.5% indirects.
* Artificially heavy volume in Tsy futures -- tied to large pick-up in rolling
from Dec to March futures ahead Thus first notice date (March goes top step, Dec
expires mid/late Dec)
* Early flow included large Block (+22.9k TYH, 124-24 helping spur early rally),
FX-tied bid as US$ weaker vs. yen, Bund-tied aid, but also pre-auctions shorts
and rate-lock hedges too amid today's 2Y, 5Y auctions and a busy high-grade
corporate bond issuance wk. Fast$ and prop acct buying before rates reversed
early gains; Mar 10Y-ultra Block sale (-7.9k, 133-30) helped trigger selling. 
* Swap spds tighter, spd curve flatter with long end breaking out of session
range, extending inversion. Flow from last hour includes.

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