Tsy are fading from intra-day.......>

US TSYS SUMMARY: Tsy are fading from intra-day highs set in mid-morning European

trading, taking cue from renewed weakness in German Bunds.  The US 10-yr Tsy

yield is down 0.4bps at 2.9586% vs low of 2.9458%, while 2-yr is now 0.9bp

higher at 2.539% vs low of 2.53%.

- Curve flattening has been the order of the day. Setting the tone is US Tsy

2s-10s, which hit 41.09bps the flattest level since 2007 and is currently at

41.5bps, down 1.2bps.

- In Asia, US T-note future traded in a narrow range with a lack of fundamental

news flow apparent in the Asia Pacific session. Markets focus continued to fall

on US trade negotiations with China, the EU & its NAFTA counterparts, as well as

the slightly softer than expected suite of US CPI data.

- US Tsy got a lift in early European trade as German Bund reversed opening

losses, but with little seen to trigger the more have since faded lower with

markets looking ahead to US open.

- Eurodollars have seen a positive start to Friday trade with contracts edging

higher by 1 to 2 ticks.