US Treasuries were well bid all morning across Asia, making up for lost ground after Treasury Secretary Mnuchin said the US Treasury was very seriously considering issuing ultra-long bonds and have no plans to intervene on the USD "for now".
Australian fixed income futures rallied on the weak capex data.
Korean Yields initially headed higher on the back of a record 2020 budget but retraced as the general economic doom and gloom reversed the feel-good budget momentum. The Won made a half-hearted rally attempt but gave way to the constant bid under USD/China.
So despite a healthy budget, the Korean market can't shake the trade war heebie-jeebies.
Equities were mixed across Asia with the Hang Seng and ASX slightly higher while Nikkei traded marginally lower.
it was a low volume session following on equally tepid flows in Wall street.
USDCNH traded in a tight range with a bid tone after the largely unchanged USDCNY fix.
Bond flows kept a constant bid tone in Gold markets
WTI continues to hold decent 24 hours support levels, despite the omnipresent trade war risk, the DOE weekly report has tempered the trade war bears.
However, overall, It feels like the markets are doing little more than clearing up loose ends ahead of the US long weekend. Moreover, given the significance of the labour day weekend, President Trump will probably keep the twitter tantrums to a minimum.