The escalation of U.S.-China........>

US TSYS SUMMARY: The escalation of U.S.-China trade tensions over the weekend

has dominated global markets, with bull steepening seen in the Tsy curve.

- Big rally: 2-Yr yield is down 9.6bps at 1.6154%, 5-Yr is down 8.8bps at 1.57%,

10-Yr is down 8.2bps at 1.7633%, and 30-Yr is down 7.5bps at 2.3068%.

- CNY up through key 7.00 level seen as a trigger for panic; MNI story this

morning suggests depreciation could go further.

- Stocks briefly pared losses Monday a.m. on BBG headline "China says U.S.

accusation on no farm goods purchase untrue", rowing back earlier BBG report.

- Follow-up headlines said Chinese companies have signed a deal on 14mln tons of

U.S. soybeans, with high prices blamed for lack of private sector purchases.

- Treasuries did not pare gains much though, and equity jump already fading.

- 10-Yr yields now down more than 30bps since Jul 31 Powell presser peak, and

back to pre-2016 election levels.

- 3M10Y down 8.2bps at -30.0bps (L: -31.995, 12-yr low).

- Data highlight is ISM non-manuf out at 1000ET (est 55.5, prev 55.1).

- FedSpeak is back w Brainard at 1330ET. Bullard (Tuesday) & Evans (Wednesday).