Tsy yields edged marginally higher.....>

BOND SUMMARY: Tsy yields edged marginally higher during Asia trade after a lack

of aggression towards China in his latest round of rhetoric. T-Notes -0-01+

last. Eurodollar futures unch. to -1.0 tick through the reds. Futures roll

volume dominated on the flow side.

- Australian bonds stuck to a tight range during the early part of the session,

looking through local data and the latest bill auction in the wake of RBA

Governor Lowe's testimony. That was before the space turned sharply bid on the

back of the change in Westpac's call re: the RBA, with YM leading (+8.5 last) XM

(+5.0 last) promoting some steepening of the curve. YM/XM trades at 38.5. To

repeat, "Westpac now expects two rate cuts next year from the RBA with the cash

rate cut to 0.25% in June 2020. Quantitative Easing is also expected to begin in

the second half of 2020." Bills unch. to +10 ticks thru reds, strip flattens.

- JGB futures last +16 ticks. The breakdown of the latest 5-10 Year BoJ Rinban

ops revealed a virtually steady offer to cover ratio & spread dynamic vs. the

prior op covering the bucket. Curve sits flatter on the day, potentially driven

by early swap receiving in the super-long end, as outlined earlier.