*** US$ index (DXY) -.144,..........>

US TSYS SUMMARY: *** US$ index (DXY) -.144, 90.249, ephemeral US$ support from

earlier has steadily evaporated. Note, gold has rebounded (XAU +1.97, 1340.40):

Equities making new all-time highs: Indu +245 and change to 26039, emini +17.25,

2799.25, West Texas crude has also rebounded (WTI +0.25, 63.98) but more on back

of cold weather affecting Texas crude ports.

- Tsys, meanwhile, remain in flattener mode, long end bids below but

thin/sporadic. Recent 10s30s ultras Blocked: +5,455 UXH, 131-31, buy through -29

offer at time of post vs. -2,539 WNH, 164-31. 10Y yld +.0203 at 2.5573, 2Y yld

+.0207, 2.0349% last seen mid-Sep' 2008.

- Ongoing high-grade corp supply -- largest issuance from banks ($3B Citi, $2.5B

Westbank, waiting on DB) generating hedging flow. Supply weighing on front end

spds. Little react to data, US Gov shutdown midnight Fri, Fed blackout Saturday

- Decent option volume, some profit taking in puts, decent low delta adds

targeting Jun rate hikes, position roll-downs and upside call buying in the mix.

- Heavy front end selling Eurodollar futures as rate hike probability for March

and June on the rise (97% and 68% respectively).