Tsys trading weaker, lower half of.....>

US TSY FLOWS: Tsys trading weaker, lower half of range, moderate futures volume

(TYM<290k), yld curves steeper. US$ index mildly higher/narrow range (DXY +.041,

97.347); US equities firmer/near highs (SPX +5.25, 2757.25).

- On tap for Monday: Jan retail sales; Dec business inventories; Feb ETI; Mar NY

Fed expectations survey. Tsy supply: 13- and 26W bills, $38B 3Y note auctions.

Fed in black-out through next week's FOMC.

- Overnight flow included better in short end to intermediates during Asian

hours, prop and real$ selling intermediates to long end midmorning London time.

Sporadic buying fronts to intermediates by fast$, 2s10s steepeners, swap-tied

buying 2s and 5s. Option premiums steady/lower, implieds running steady to

mildly bid at the moment.

- Tsy cash/ylds: 2Y 100-01.38 (2.475%), 5Y 99-22 (2.440%), 10Y 99-25.5 (2.646%),

30Y 99-09 (3.035%).