*** Tsys trading weaker w/EGBs,.....>

US TSYS SUMMARY: *** Tsys trading weaker w/EGBs, near bottom end of range on

decent volume (TYM>350k), carry-over risk-on tone at the moment amid headlines

that N.Korea can discuss de-nuclearisation if regime safety agreed. Equities

trading higher/adding to Mon's bounce (emini +11.0, 2729.5). US$ index lower

(DXY -.407, 89.673); gold stronger (XAU +7.15, 1327.29); West Texas crude adding

to Mon's late rally (WTI +0.60, 63.17).

- Asia, generally quiet side-ways trade for much of the Asian session, opened

steady/mildly weaker into London crossover, two-way in the short end with real$

buying 2s vs. central bank selling, real$ selling intermediates.

- London, recovered/traded higher in first three hours of London trade, under

pressure last two hours, Tsys extend overnight lows/trailing Bunds and Gilts.

Flow included carry-over real$ selling belly w/bank portfolios, fx-tied selling.

- Swaps, spds running tighter, spd curve flatter at moment, decent receiving in

5s recently after some switch action around 2.72917% overnight.

- Eurodollar futures, weaker, short end offered post 3M LIBOR +0.0124 to

2.0473%, +0.0221/wk, EDH8 down to 97.892 (-0.017).