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Tsys hold mildly lower/off.............>

US TSY FLOWS
US TSY FLOWS: Tsys hold mildly lower/off midmorning lows amid general risk-on
tone, equities trading higher (SPX>+30.0), initial impetus appears to be
narrowing of BTP/Bund spds on positive budget chatter from Italy. Italian banks
bid, European and US shares on the follow. VIX -2.05 at 19.47, US$ index +.135
at 97.051, West Texas crude +1.38 at 51.80.
- Slow start to busy week, no react to Nov Dallas Fed manufacturing index, bill
and note auctions and NY Fed VP Richard Dzina keynote remarks at the Clearing
House and Bank Policy Institute's 2018 Annual Conf, NY.
- Heavy Tsy futures flow largely driven by Dec/Mar roll activity: TYZ/TYH appr
635k. In-line $39B 2Y auction (CUSIP 9128285Q9) awarded a 2.836% rate (2.880%
previous October auction) vs. 2.837% WI, bid/cover 2.65 vs. 2.67 previous (2.84
avg). Flow includes mild month end extensions, mixed curve flow, mild corp deal
and Tsy auction-tied hedging vs. 13- and 26w bills, $39B 2Y auctions.
- Tsy cash/ylds: 2Y 100-02.5 (2.832%), 5Y 99-28.5 (2.897%), 10Y 100-15.5
(3.066%), 30Y 101-03 (3.316%).

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