T-Notes sit above Monday's closing..........>

US TSYS: T-Notes sit above Monday's closing levels, but still a touch softer

than settlement levels in early Asia-Pacific trade, last -0-02 at 127-14.

- The bid in the Tsy space gave way in late U.S. trade on Monday, although the

long end of the curve continued to outperform as 30-Year yields held in negative

territory on the day, resulting in some twist flattening of the curve as the

space backed away from pricing a 50bp cut at the Fed's July meeting in lieu of

Friday's NFP print. T-Notes finished a touch above unchanged levels as a result.

- Decent enough corporate issuance resulted in hedging flows, elsewhere there

was some short covering noted ahead of Tuesday's 3-Year supply. A ~$900K DV01

2s/ultras flattener was seen in the futures space, and provided the highlight of

Monday's Tsy flow.

- Eurodollar futures unch.-0.5 tick lower through the reds. Upside protection

was sought on Monday, even as 50bp July cut expectations were almost completely

priced out of the markets.