T-Notes +0-01+ at 129-18, after closing.....>

US TSYS: T-Notes +0-01+ at 129-18, after closing just shy of best levels on

Monday. Flow helped T-Notes move away from their early NY lows, after the

contract moved lower on the latest round of Sino-U.S. trade optimism ahead of

U.S. hours, with traders looking towards month-end/a holiday altered weekly

schedule, as well as some light TYZ9 block buying, as the reasons for the NY

rally. There was also some notable buying of Feb '20 TY calls, targeting a yield

of ~1.40%. Yields across the curve finished Monday 1.0-2.0bp lower. Elsewhere,

roll volume dominated.

- The latest 2-Year auction did no harm to the broader dynamic, stopping through

by 0.4bp, as direct participation jumped at the expense of both dealers and

indirects.

- On the repo front, the Fed's first batch of term repos covering year end was

nearly 2x oversubscribed, which resulted in the NY Fed boosting the "aggregate

operation Limit for the 42-day repo operation scheduled for 12/2/2019 from at

least $15 billion to at least $25 billion."

- Focus moves to an address from Fed Chair Powell, due in under an hour's time.