The overnight repo market on Tuesday.....>

US TSYS/2Y: The overnight repo market on Tuesday saw the Treasury 2-year note,

5-year note and 10-year note all tighten, said traders. The 2-year note had

"legitimate shorts" but also some trying to "squeeze the shorts," said traders.

Various accounts sought to short the 2-year note for pre-auction short reasons,

but also to try to adjust to the front end prices, said observers.

- The 5-year note tightened in its usual early pre-auction midmonth tightening

trend heading into the late month 2/5/7-year note auctions, said traders.

Meanwhile the 10-year note began to tighten Tuesday. The Treasury General

Collateral rate traded at 1.09%. (More)