T-Notes a touch softer than settlement......>

US TSYS: T-Notes a touch softer than settlement after firming Tuesday as the

curve edged flatter (10-Year yields closed sub-2.00%). Space did experience some

pressure in the U.S. PM on less dovish comments from Fed's Bullard (not looking

for a 50bp rate cut in July), while Chair Powell's comments were seen as similar

to the rhetoric employed at the FOMC decision, but slightly more hawkish at the

margin, if anything, as there was no indication of an impending 50bp cut in July

(noted the need to not overreact). Bullard has also noted that he would favour 2

rates cuts during '19 & that the Trump Admin approached him re: a seat on the

Fed board in recent months. Elsewhere Fed's Barkin noted that the FOMC's current

stance is moderately accommodative & declined to comment on rate cut prospects.

- Bullard/Powell inspired losses were largely recouped on the back of a RTRS

piece noting that the U.S. would not accept conditions on tariffs as part of

reopening trade negotiations with China & that no deal is expected to emerge

from the G-20, per a senior U.S. off'l. A soft cash equity open and weak

consumer conf. data had leant support in the U.S. morning.

- Latest 2-Year supply went well, auction cut off was pre-Powell comments.