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JGBS

Curve Twist Steepens, Futures Narrow

US EURODLR FUTURES

EDU2/Z2/H3 Fly Given

US TSY OPTIONS

TYF2 132.00 Calls Still Being Lifted

FOREX

USD Pares Early Losses, JPY Struggles

US TSYS SUMMARY
US TSYS SUMMARY: US Tsys are trading higher, but just off session best levels
underpinned by China growth concerns, disagreements among European countries and
continued impact of US/China trade tensions. The belly of the yield curve is
leading the outperformance compared to the wings.
- 10-yr Tsy yield is 2.9bp lower at 2.8474% with 2s/7s yield spread 1.1bp
tighter and 7s/30s 0.8bp wider.
- Treasuries traded in a very narrow range during Asia session, but then started
to squeeze higher just before start of European session, supported by block buy
in 10-yr T-note future at 120-01 in 3.4k. Tsys then extended gains taking cue
from opening rally in Bunds.
- Markets concerns on China growth and Italy's Conte opening divisions with the
European Union on reform and immigration all appeared to underpin rally in
sovereign bonds.
- Euro$ strip has edged higher/flatter with greens +3.5/4 ticks in moderate
volume. Attention now turns to durable goods, advanced retail sales and $16bln
2-yr FRN & $36bln 5-yr auction and comments from Bos Fed Pres Rosengren