US Treasuries are trading lower.....>

US TSYS SUMMARY: US Treasuries are trading lower having fallen in Asian session

on back of weak JGBs as markets test BoJ's wider trading band for 10-yr JGBs and

digest latest news on US/China trade dispute. US 10-yr T-note yield is 1.9bp

higher at 2.9784% with yield curve steeper as short-end remains anchored.

- US Tsys initially spiked higher at start of Asian session, supported by

reports that US is thinking of levying a 25% tariff on $200bn worth of Chinese

goods, up from the prior 10%. However, Tsys gradually faded the move and dropped

lower on back of move lower in JGBs.

- US Tsys were at or close to session lows on crossover to the London trade and

this is where they have remained, with TYU8 trading in a very tight range of

between 119-09 to 119-11, with little seen to direct markets.

- Eurodollar futures are steady to 2.5 ticks lower, strip steeper as blue

contracts come under the most selling pressure.

- Markets attention turns to US ISM manufacturing at 1000ET and then FOMC

monetary policy decision and statement at 1400ET