US rates rotated around mixed levels...>

US TSY/RECAP: US rates rotated around mixed levels in a narrow range for much of

the US session, as the long end gained late on.

- With no significant data released during the session, focus fell on 2018 Voter

and Clev Fed President Mester, as she stuck to her hawkish script. Late in the

day a sources piece suggested that Mester was in contention for the empty Fed

Vice-Chair role, although the story did note that the race is fairly open, with

other well touted names (Williams & El-Erian) still in the running.

- Flow was two-way on net, with positioning ahead of tomorrow's CPI apparent,

curve flatteners in 2s & 5s vs. long end; swap spds ground tighter on more mixed

flow. Heavy option volume was seen, with long puts unwound

- T-Notes last at 121.01+, 10-Year yield last 2.829%