T-Notes edge higher in early Asia-Pac.......>

US TSYS: T-Notes edge higher in early Asia-Pac trade, but still sit below

settlement levels, -0-05+ at 132-30+. 10-Year Tsys registered a fresh low in

yield terms on Tuesday as heightened worry/caution re: coronavirus became

evident in the latest round of addresses from U.S. health care officials, even

as Fed Vice-Chair Clarida, and later Kaplan (in the NY/Asia crossover), pushed

back on the idea of an imminent cut from the Fed in the wake of the outbreak,

sticking to the recent broader tone of FOMC communique. Convexity hedging

interest was seemingly apparent Tuesday, while yields finished the day back from

richest levels as the curve bull steepened (0.-9-2.6bp worth of richening was

seen across the curve). Early equity recovery was more than unwound as virus

worries began to dominate again during European hours. Equities saw the DJIA

break below its 200-DMA for the first time since October, closing below the

level, while the S&P 500 shut below its 100-DMA.

- The latest leg of the rally generated a weak 2-Year auction, with a 1.6bp tail

seen, alongside a moderation in the cover ratio and a notable uptick in dealer

participation, as direct takedown eased.