Treasuries have a mild price.............>

US TSYS/2Y: Treasuries have a mild price concession heading into the 1pm ET $26B

2Y note auction after morning shorts/sales and also corporate rate-lock hedges.

Some thought the 2Y prices had become cheap enough already to discount a Dec

potential rate hike, but there are still some mild worries about 12:45pm ET

speech by Fed Chr Yellen.

- TD analysts Cheng Chen and Gennadiy Goldberg said "recent 2yr auctions have

gone extremely well, with five of the past six auctions stopping through the

screens." They add 2Y auction "averages hint at a strong auction, pointing to a

stop 0.4bp through the screens and 69% buyside takedown: 55% to indirects and

14% to directs." 

- They also said that Tsy will raise a combined $101B this week amid 2Ys, $34B

5Y and $13B Reopened 2Y FRNs Wed and $28B 7Ys Thurs. 

- They add with the Fed's "balance sheet runoff only beginning in October,

reinvestments will continue at this auction series." 

- HISTORY: The $26B August 2Y note auction had a 1.345% rate, 1.250% coupon, a

2.86 cover, 45.8% indirects, 12.2% directs, 41.64% dealers.