The return of the geopolitical risk....>

BOND SUMMARY: The return of the geopolitical risk premium surrounding the well

documented weekend attacks on major Saudi crude facilities supported core global

FI in Asia hours, although the closure of Japanese markets sapped liquidity from

the time zone. Soft Chinese economic data also provided some support for the

space.

- T-Notes trade +0-14 at 129-00+, just shy of best levels, with cash Tsys closed

until London hours owing to the aforementioned Japanese holidays. Eurodollar

futures sit 0.025-6.5 ticks higher through the reds. There was little to report

in terms of standout flow, even with T-Note volume running well above the recent

averages overnight.

- Aussie bond futures edged away from the SYCOM lows, but still sit below

Friday's settlement levels after the movements in Tsys dragged the space lower

in the final overnight session of last week. YM & XM both -2.5 ticks, with YM/XM

at 29.75 and the cash equivalent at 26.4bp. Bills sit 2-3 ticks lower through

the reds.