Tsys trade steady/mixed in the......>

US TSYS SUMMARY: Tsys trade steady/mixed in the second half, mid- to lower half

of range, curve off new 10+ year flats tapped in the first half (5s30s 26.218L),

modest session volume (TYM<855k) on quiet end to wk. Quiet reversal of support,

long end pared gains prior to U-Mich data and Fed Bullard comments: yld curve

inversion risk "crunch time", current policy rate pressing against 'upper bound'

of neutral, low mkt-based infl measures cautions rate hikes.

- US$ index ratcheted lower (DXY -.139, 92.511; US$/Yen 109.278); equities

firmer (emini +3.75, 2722.25), West Texas crude weaker (WTI -0.26, 71.10 vs.

71.63H); gold weaker (XAU -0.56, 1321.04).

- Swaps spds tighter/spd curve adding to prior day's steepening w/short end

leading move; 2Y spd currently back to early Feb level (lows for year appr 17.5

during January). Decent rate receiving/payer unwinds in 2s as front end of

Eurodollar strip surges (3M LIBOR -0.0125 to 2.3425%, -0.0265/wk) w/others

fading the move via paying in 2s around 2.7675, receivers in 1s (2.54875-2.55%),

$214k 2s3s7s fly, paying 7s.

- Tsy ylds: 2Y 2.535%, 3Y 2.690%, 5Y 2.837%, 7Y 2.940%, 10Y 2.971%, 30Y 3.112%