153.00 capped JGB futures in the Tokyo.........>

JGBS: 153.00 capped JGB futures in the Tokyo morning, with the contract back

from best levels, but still 35 ticks or so higher on the day, while the Nikkei

225 trades 2.7% lower, after shedding 3.6% in early trade as Japanese markets

played catch up after the holiday. A Nikkei report suggesting that the BoJ is

considering cutting its inflation outlook at its Jan MonPol decision is also

adding further support.

- Curve continues to flatten, with 10-Year JGB yields at -0.032% last, off of

lows, but still printing at levels not seen since November 2016.

- BoJ left the size of its 5-10 Year Rinban operations unchanged today. Offer to

cover ratio 2.37x (prev 1.77x).

- Worth highlighting newswire reports that Japan's MoF, the BoJ & FSA officials

are meeting to discuss financial markets.

- Swaps through to 10-Years have widened vs. JGBs, while longer dated swaps have

tightened.