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Tsy near late session highs after......>

US TSY FLOWS: Tsy near late session highs after the bell amid heavy month-end
buying (TYM>200k from 123-21 to -22; >120k FVM from 115-20 to -21). Curves
mostly adding to Mon's bear steepening, 3M10Y flatter. Relative quiet at start
of two-day FOMC. 
- Early blocks included ongoing FVM selling, 5s10s flatteners -- reversed late
on month end bid. Tsys surged well ahead of large PMI miss (52.6 vs. 58.5
est),large equity sell program added to rate bid but equities recovered from
late morning on (SPX +2.0 late at 2945.0).
- Swaps wider amid better rate paying and deal-tied flow, some receiver unwinds
and two-way fly trade in fronts to intermediates. Other buying/short unwinds as
EFFR climbed to 2.45%, spurring increased chatter of IOER cut.
- On tap for Wednesday: MBA Mortgage Applications; ADP private payrolls; Markit
Mfg Index (final); construction spending; ISM Manufacturing Index; NA-made light
vehicle sales SAAR; FOMC policy announcement.
- The 2-Yr yield is down 2.6bps at 2.2661%, 5-Yr is down 3.3bps at 2.2783%,
10-Yr is down 2.3bps at 2.5018%, and 30-Yr is down 2.4bps at 2.9311%.

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