Tsy Block Flow & Aussie Restrictions Lend Support In Asia

T-Notes nudged higher during Asia-Pac hours, last +0-04 at 138-13+, although struggled for anything that could be classed as meaningful follow through above Tuesday's best levels. Cash Tsys saw some light bull flattening, with yields sitting unchanged to 1.0bp richer across the curve, building on the momentum seen on Tuesday. President Trump continued to provide election-related unrest, and fired the Director of the Cybersecurity and Infrastructure Security Agency from his post on election related matters. Flow-wise 40K of FVF1 126.00 call sales were quasi-hedged via 10.0K of TYZ0 lifts, split across 2 block trade. Eurodollar futures sit unchanged to +0.5 through the reds, with a flurry (~19.0K) of EDZ0 salles noted at 99.750.

• JGB futures held a tight range during Tokyo dealing, last +9 vs. settlement levels. The long end has outperformed in cash JGB trade, even with a slightly weaker than prior 20-Year JGB offering, which saw the cover ratio nudge lower and price tail edge wider. The cover ratio represented the lowest such reading seen at a 20-Year auction since April's 20-Year offering. Still, the low price topped dealer expectations (proxied by the BBG dealer poll).
• The dynamic in U.S. Tsys and earlier flagged "pause" (social restrictions) implemented in South Australia on the back of the local COVID situation has provided some support for the Aussie bond space in what has been a fairly lacklustre Sydney session, allowing the overnight flattening impetus to extend at the margin. YM +1.0, with XM +6.5. Governor Lowe offered nothing of any real note in his latest appearance.