Treasuries hold tight higher........>

US TSYS SUMMARY: Treasuries hold tight higher range slightly off day's price

high. Action quiets after morning, midday FX-tied black box buying on weak

US$/yen and bid on weak yr/yr 1.4% PCE core price index rise and higher initial

weekly jobless claims. 

- Mkt digested steady 58.9 MNI Chicago Business Barometer, fractionally firmer

53.3 Bloomberg Consumer Comfort Index without much reaction. 

- Between morning and midday FX-tied bid, Tsys saw late morning real$ and spec

selling in 10Y, 30Y; bank portfolios sell 30Y. The 2nd round of FX-tied buying

in Tsys after Tsy Secy Mnuchin said "having a weaker US$ is somewhat better for

US trade." 

- Tsys morning month-end buying aiding back end most; Bloomberg Barclays Tsys

advance index estimate: large 0.11 yrs extension. 

- Tsy futures: Early large blocks 8:21am ET: 10,000 FVZ (5Y futs) at 118-12 and

for 5,000 TYZ (10Y) at 126-23.5 (both legs below bid at post time:likely sales.)

-Tsy auctns Sep5: $33B 26wk bill, $39B 13-wk bill, $25B 8day CMB, $20B 4wk bill.