OIL: Mid-Day Oil Summary: Crude Rises

ERZ6 97.37/97.43/97.50/97.62c condor bought for 1.5 in 3k.

"*JAPAN GROWTH MINISTER KIUCHI: OUR FISCAL SITUATION IS IMPROVING" bbg

"*KIUCHI: NOT SO DIFFICULT TO FIND 5 TLN YEN FOR SALES TAX CUT"

"*KIUCHI: SOME TAX CUT FUNDING TO COME FROM REVISION OF SPENDING"

"*KIUCHI: DON’T EXPECT YEN’S DEPRECIATION TO CONTINUE"

"*KIUCHI: INCREASED INVESTMENT WILL BE POSITIVE FOR YEN"

"*KIUCHI: BOJ HAS BEEN DOING A GOOD JOB ON POLICY"

Treasuries have on balance continued to pare Friday’s initial rally on the NFP report although the longer end remains off early overnight lows despite losses picking up recently as US desks filter in. Iranian FM Araghchi said on Sunday Iran-US negotiations are currently not taking place, adding that talks cannot resume until Washington ends its violation of MoU commitments and compensates for those breaches. Axios on Sunday reported President Trump is prepared to allow economic pressure on Iran to mount — as opposed to ordering a new military offensive — even as the country continues to defy the U.S.

• Cash yields are 1-2bp higher on the day with increases led by the front end.
• TYU6 trades at 108-19 (-01+) on light cumulative overnight volumes 215k, back close to Friday’s pre-NFP levels via a high of 109-01+ on the report.
• Friday’s high marked a latest step towards resistance at 109-05+ (50-day EMA) with short-term gains deemed corrective. The short-term trend condition remains bearish with support at 108-08+ (Aug 4 low) before 107-31+ (Jul 31 low)
• Fedspeak: Hammack on Yahoo Finance (1500ET) – see STIR bullet
• Bill issuance: US Tsy $92B 13W & $79B 26W bill auctions (1130ET)
• Politics: All closed press events for President Trump today with policy meeting (1230ET), Swearing-in ceremony for US Attorney General (1400ET), Signing executive order (1445ET) and tele-rallies (1830ET, 1900ET)