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US Treasuries are holding onto......>

US TSYS SUMMARY
US TSYS SUMMARY: US Treasuries are holding onto modest gains seen overnight,
underpinned by the rise in trade tensions between US/China as Beijing are
weighing countermeasures to offset the negative shock of the new $200bln tariff
threat. US 10-yr yield is 1.1bp lower at 2.838% with yield curve slightly
flatter with 5s/30s 0.6bp tighter at 20.1bps.
- In response to news that US is looking to add 10% tariff on another $200bln of
goods imported from China, China was reported to be considering what
countermeasures to take once it has evaluated the impact of the trade war on
respective companies and industries.
- There has been a dearth of macroeconomic data from the Eurozone and London, so
markets have been keeping an eye on political developments -- Trump says in
breakfast meeting with NATO Chief that "Germany is a captive of Russia" due to
oil pipeline, and bond supply from Germany, UK & Portugal. US sell $22bln 10-yr
today while PPI data is released at 0830ET.
- Euro$ strip is flatter as blues rise by 3.0 to 3.5 ticks vs +1 to +2.5 tick
move in whites. 

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