Tsys drifting around lower half.....>

US TSYS SUMMARY: Tsys drifting around lower half of range by the bell, light

volume (TYU<710k). Little new ground covered by Fed Chair in MonPol testimony,

was brief period of selling down to (mild) session lows then steady (but mild)

buying around time Powell mentioned protectionist trade policies not good. Back

to summer trade (not much expected from House FSC testimony tomorrow) Bullard

Friday ahead Saturday blackout.

- US$ index firmer: DXY +0.434 to 94.945; US$/Yen higher +.54 to 112.83

(112.93H/112.23L); equities strong (emini +15.5, 2812.0); gold hammered (XAU

-12.74, 1228.26); West Texas crude steady after Mon's sell-off (WTI +0.00,

68.05).

- Participants stayed close to the sidelines, traders disappointed, were keen to

hear more on curve flattening and trade war implications; too many unknowns for

them to game out. Two-way flow on range, some deal-tied hedging across curve

($4.6B MUFG 6-parter covering 3Y-20Y launched late); two-way prop and

option-tied hedging. Tsy cash/ylds: 2Y 99-25 (2.611%), 5Y 99-11.75 (2.761%), 10Y

100-03.5 (2.860%), 30Y 103-02.5 (2.968%)