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

JGBS: 153.00 capped JGB futures in the Tokyo morning on Friday, after JGBs

started '19 on the front foot, playing catch up to market developments over the

New Year period. A Nikkei report suggesting that the BoJ is considering cutting

its inflation outlook at its Jan MonPol decision added further support. The

contract subsequently eased back from best levels in Japanese hours, as the

Nikkei 225 recovered from lows. The equity rally garnered pace in the U.S.

session, with Powell's soothing words & a blockbuster NFP report aiding

sentiment, allowing the contract to ease in overnight trade. Worth highlighting

a meeting between Japan's MoF, the BoJ & FSA off'ls from Friday, with the usual

rhetoric employed by the MoF i.e. will take apt steps re: FX if needed.

- Curve ran flatter on the day, with 10-Year JGB yields closing at -0.040%,

finishing off of lows, but still at levels not seen since November 2016.

- BoJ left the size of its 5-10 Year Rinban ops unchanged Friday. Offer to cover

ratio 2.37x (prev 1.77x).

- Focus this week will fall on Rinban ops (1-5 & 10-25+ Year due today), as well

as 10- & 30-Year supply.