T-Notes continue to stick to a tight...>

BOND SUMMARY: T-Notes continue to stick to a tight range, even with heightened

geopolitical risks evident, last +0-00+ at 127-17. Tsys yields trade mixed,

resulting in some marginal twist steepening in the cash space. Eurodollar

futures are unchanged to 0.5 tick higher through the reds.

- JGB futures have also stuck to a tight range, operating within the upper end

of the overnight session's range. The contract last deals 4 ticks higher vs.

settlement. The space witnessed a solid enough round of 2-Year supply as the

tail narrowed, cover ratio edged higher & low price topped dealer exp.

- Aussie bond futures moved higher in the wake of RBA Gov. Lowe's latest speech,

but now trade shy of best levels. YM +3.0, XM +5.0 on the day. Lowe pointed to a

lower for longer rate environment, with the possibility of additional rate cuts.

Lowe also noted that evidence doesn't support a change of the Bank's inflation

target & that the current target is flexible enough. Lowe also noted that there

"might be some drafting changes in the wording of the monetary policy

agreement." We would suggest that this would likely be superficial, as was

highlighted by the local press & mentioned in bullets earlier today.