Twist Steepening On Monday

T-Notes trade a touch above Monday's late NY levels, last -0-02+ at 134-04.

• As a reminder, T-Notes went out around late NY lows after pulling away from best levels that were inspired by the sell-off in the Chinese equity space, with U.S. equities edging higher on Monday. Chinese equities recovered from worst levels of the day into the domestic close, but were still comfortably lower on the day in the wake of the seemingly ever-growing regulatory oversight (with several sectors impacted since Friday's local close).
• Decent early volumes slowed as we moved through the NY session, with the space observing fairly restrained ranges. The cash Tsy curve saw some twist steepening, with 2s 0.5bp richer and 30s ~2.5bp cheaper at the bell.
• 2-Year Tsy supply stopped through WI by 0.2bp, with the cover nudging a little below the recent averages, while dealer takedown edged below the recent averages.
• Tuesday's Asia-Pac docket is slim, while the NY docket will be headlined by durable goods and consumer confidence data, as well as 5-Year Tsy supply.