Tsy futures trading firmer, upper......>

US TSY FLOWS: Tsy futures trading firmer, upper half of range on average volume,

following firmer EGBs. Day 2 of the FOMC meeting, Fed releases Summary of Econ

Proj'ns at 1400ET, Fed Chair Yellen press conf at 1430ET. US$ a little softer

vs. Yen (111.328), equities near steady (emini, +0.5, 2505.25) gold stronger

(+3.02, 1314.12), oil firmer (WTI +0.60, 50.08).

- Asia, good demand for 6M bills and more so short dated coup's after poorly bid

auction Tue. Sources reported foreign central bank buying 2s-5s, other bank

buying 5s, Asian end users buying 10s and 30s, insurance portfolio buying off

the run 10s.

- London, good German thirty year Bund auction stabilized EGBs, Tsys followed.

Tsys drew bid later as European stocks faded off highs. Flow included bank

portfolio buying 3s, macro fund buying 10s.

- Overnight repo tight in 2s, 3s, 5s, 7s and 10s.

- Swaps, spds running mildly tighter to steady in long end, directional w/Tsy

ylds, light flow

- Eurodollar futures mildly higher, middle narrow range, decent buying Dec'17