T-Notes have held a 0-02+ tick.........>

BOND SUMMARY: T-Notes have held a 0-02+ tick range, last -0-00+ at 129-04+, with

the yield curve twist steepening (5s30s ~3.5bp steeper at writing.) after

confirmation that the U.S. Tsy will issue 20-Year bonds in H120, following input

from market participants. Contract tested early lows after solid to strong

Chinese economic activity data. Focus on some early Asia block flow which

initially looked like TY/US & TY/WN mis-weighted steepeners when looking at

prices, but various sources pointed to a fly structure being in play, selling

USH0, based on the aforementioned 20-Year issuance announcement.

- JGB futs edged higher in the afternoon, last +12, with the long end

experiencing some marginal outperformance in the wake of a solid enough round of

20-Year supply. On the budget front, the govt's semi-annual update left the

timeframe in which it expects to achieve a balanced budget unchanged, although

it revised down initial surplus estimates (in terms of nominal amounts).

- Aussie bond futures saw nothing in the way of tangible reaction after the AOFM

noted that it will sell A$3.5bn of the new 1.25% 21 May 2032 bond next week,

with coupon size in line with exp. YM +0.5, XM unch.