Treasuries creep a bit higher off the....>

US TSYS/7Y: Treasuries creep a bit higher off the afternoon range after mild

market improvement; Tsys saw 5/30Y, 2/10Y, 2/30Y curve steepeners done. 

- Jefferies' Tom Simons noted that "the 7-year note auction stopped 0.3 bps

above where the WI was bid at 1:00PM at 2.126%. The stats generated by this

auction were very close to average, much like last month.

Indirects took down 67.7% of the auction, which is a bit below the recent

average. However the recent average is skewed to the upside because of the 81.7%

takedown in April that was, as the time, a record high for all Treasury coupon

auctions, dating back to May 2003. On the other side of the coin, Dealers took

down 20.6% of the auction, the smallest since the 8.8% record-low takedown in

April. Directs took down 11.6%, almost spot on average." He adds that auction

results and recent curve movement show that "front-end of the curve is the best

performer right now. The auction results were very close to average, so they do

not suggest that anything is about to change."