TREASURY WRAP: T-NOTE FUTURES (U6) SETTLE 8 TICKS HIGHER AT 108-18+

T-notes rose across the curve as oil prices tumbled in the wake of the US and Iran pausing strikes over the weekend. At settlement, 2-year -1.9bps at 4.318%, 3-year -2.3bps at 4.347%, 5-year -3.4bps at 4.397%, 7-year -4.2bps at 4.509%, 10-year -4.0bps at 4.641%, 20-year -3.4bps at 5.152%, 30-year -3.4bps at 5.127%.THE DAY: Treasury yields moved lower across the curve on Monday, tracking the sharp decline in oil prices. The US paused strikes against Iran over the weekend, while reports and commentary from officials, including President Trump, suggested the two sides could hold talks and potentially meet. The de-escalation and increased hopes for diplomacy saw oil prices tumble by over USD 7/bbl, helping ease some of the recent inflation concerns ahead of Wednesday's FOMC decision.Aside from the reduction in the geopolitical risk premium, Monday's session saw two Treasury note auctions with mixed results. The 2-year auction was strong, stopping through the when-issued yield by 0.5bps, while the 5-year was soft, tailing by 0.9bps. Some of the concession into the 5-year auction had faded following the strong 2-year offering and subsequent richening in Treasuries, potentially reducing the attractiveness of the yield on offer at the margin.Elsewhere, US data had little impact on price action. Durable Goods Orders missed expectations on the headline, although the underlying details were more encouraging. Core capital goods orders remained firm, shipments accelerated and prior readings were revised higher, pointing to continued strength in business investment, supported by AI-related demand and some stockpiling by firms. Following the data, the Atlanta Fed's GDPNow estimate was revised slightly lower to 1.6% from 1.7%.Attention turns to the 7-year note auction on Tuesday to see how demand fares following Monday's mixed results, while the week's main event will be Wednesday's FOMC decision, followed by the US GDP and PCE on Thursday SUPPLYNotes US sold USD 69bln of 2-year notes; Stop through 0.5bps. US sold USD 70bln of 5-year notes; Tail 0.9bps US to sell USD 44bln 7-year notes on July 28; US to sell USD 30bln 2yr FRN on July 29th; all to settle on July 31st. Bills US to sell USD 92bln 13-week bills and USD 79bln 26-week bills on July 27; to sell USD 95bln 6-week bills on July 28; all to settle on July 30 US sold 4-wk bills at high-rate 3.730%, B/C 2.79x; sold 8-wk bills at high-rate 3.795%, B/C 2.31x STIRS / OPERATIONS Fed Pricing: 36.3bps (prev. Dec 36.5bps) EFFR at 3.63% (prev. 3.63%), volumes at USD 106bln (prev. USD 104bln) on July 24th SOFR at 3.64% (prev. 3.64%), volumes at USD 2.979tln (prev. USD 2.971tln) on July 24th NY Fed RRP op demand at 1.38bln (prev. 0.68bln) across 3 counterparties (prev. 2) on July 27th