Tsys drifted lower in Asia, ltd range.......>

US TSYS: Tsys drifted lower in Asia, ltd range. Yields +0.4-0.8bp across the

curve, T-Notes 0-02+ lower at 128-27, off lows. Late NY saw the U.S. formally

remove China's FX manipulator title, as per earlier source reports. Comments

from U.S. TR Lighthizer, pointing to the phase 1 trade deal being "about

finished," as well as an inclusion of commitments re: FX manipulation also

helped in Asia-Pac hours, as did source pieces pointing to quantities of U.S.

goods to be bought by the Chinese. Dec Chinese trade data showed stronger than

exp. imports & exports (base effects), while Sino-U.S. trade -10.7% Y/Y in '19

- Option activity was elevated in Asia. A package of -20.0K USG0 155.00 puts,

+10.0K USH0 154.00 puts & -5.0K USH0 161.00 calls was blocked. Suggestions that

the puts were unwinds & the call was an add to an existing position. This was

followed by a block package of +10.0K USH0 155.00 puts, -20.0K USH0 153.00 &

-10.0K USH0 162.00 calls trading at -0-01, buying the 1x2 put spread to sell

calls. We also saw a 20.0K screen buyer of TYH0 131.00 calls.

- CPI & weekly earnings data due Tues, Fedspeak slated from Williams & George.

The NY Fed will release its bill buying & repo schedule for the next month.