US Treasuries are trading...........>

US TSYS SUMMARY: US Treasuries are trading modestly higher and at the top end of

their relatively tight range since US close Monday, supported by recovering

German Bunds on soft flash PMI data and strong demand at ESM 5-yr syndication

deal.

- 10-yr Tsy Note yield is 0.7bp lower at 2.9467% while 5s/30s part of the yield

curve is 0.4bp flatter. 

- US Treasuries had a quiet Asian session consolidating most of Monday's

losses/curve steepening move, with T-Notes sticking to a +/- 3 tick range.

- US Tsys initial slipped to session lows as London trade got underway, but

slowing grinded their back up towards intra-day highs as overall Eurozone flash

composite PMI dropped to 54.3 in July from 54.9 in June, with better

manufacturing more than offset by weaker services.

- Eurodollar futures are 1 to 2.5 ticks higher led by EDM0 contract, supported

by decent buying seen during Asia session & steady flow in London so far.

- Data this afternoon is limited to Philadelphia Fed Nonmfg Index, US flash PMI

from Markit and Richmond Fed mfg index. US also sells 2-yr notes for $35bln.