The feel-good tone on global........>

US TSYS SUMMARY: The feel-good tone on global trade/risk has continued through

the European morning, with curve steepening in focus.

- Risk continued to rally in Asia-Pac/Europe session, triggered byFT story that

US considering rolling back some import tariffs on Chinese goods. 2s10s briefly

hit best levels since July (22.48bps), has subsided a little since.

- The 2-Yr yield is up 1.2bps at 1.5944%, 5-Yr is up 2.3bps at 1.6163%, 10-Yr is

up 3.2bps at 1.8088%, and 30-Yr is up 4.2bps at 2.3045%.

- Little impact on Tsys from Global Times` Hu tweet saying China wouldn`t accept

phase 1 deal in which U.S. merely suspended `new tariff threat`.

- Amid it all, saw bearish options structures in decent size ... FV (5-Yr) Jan20

Buying put spread, selling calls. Some ED options downside as well.

- Sep Trade Balance (0830ET) and US non-mfg ISM (1000ET)= data highlights.

- On FedSpeak side, SF Fed's Daly said Monday she was `very supportive` of the 3

25bps cuts so far, but that policy level now 'right'.

- Today we get Barkin at 0800ET, Kaplan at 1240ET, and Kashkari at 1800ET.

- On supply, we get $28bln 1-Yr (1130ET) and $38bln 3-Yr (1300ET) sales.