Tsys traded lower on Wednesday,........>

US TSY/RECAP: Tsys traded lower on Wednesday, extending to session lows in late

dealing, 2s-10s curve was marginally steeper, 5s30s marginally flatter.

- Little reaction was noted against limited data.

- Fed voter Dudley stressed that a gradual hiking path for rates is still

appropriate, while Fed Governor Quarles stated that the current flattening of

the US yield curve is not a signal pointing to a recession. Elsewhere non-voter

Bullard stuck to his dovish script, noting that markets are not seeing much

inflationary pressure, while he suggested that yield curves could invert in the

next 6 months.

- On the flow front, option volume was heavier & mixed, with 2-way noted in puts

& call buying fading the sell-off.

- The Eurodollar strip went out near session lows. - T-Notes last at 102.04+, US

10-Year yields last at 2.873%.