T-Notes -0-02+ at 130-26 as we type. -......>

US TSYS: T-Notes -0-02+ at 130-26 as we type.

- Coronavirus worry drove a strong safe-haven bid for rates on Monday, with

T-Notes closing just shy of best levels on strong volume, with bull flattening

the order of the day on the curve (yields 5.5 to 7.5bp lower across the curve at

the close), allowing the 2-/5-Year yield spread to close in inverted territory.

- London hours saw some profit taking creep in, with the contract edging away

from best levels in the NY crossover, before grinding bid again in NY trade.

- The richening meant that the latest round of 2- & 5-Year supply was less than

stellar, with 5s in particular suffering, although this provided little in the

way of respite re: the bid.

- Monday saw bulls fail to mount a sustained challenge of 131-00 in T-Notes, as

yields bottomed out around 1.60%. N.B. some have highlighted large short

positioning 131.00 calls