As a reminder JGB futures & the longer end.....>

JGBS: As a reminder JGB futures & the longer end of the cash space showed little

to no signs of concession ahead of yesterday's 20-Year JGB auction, with the

belly to longer end outperforming in cash trade, perhaps supported by Y20tn

worth of redemptions in the space.

- The low price of the auction was in line with dealer exp., with a solid enough

cover ratio on show, albeit a little softer than the previous auction. The tail

was 0.1bp wider than the previous auction.

- JGB futures eased a touch following the auction, with the super-long end of

the cash curve unwinding its modest outperformance, likely on the back of the

back up in the cover ratio & slightly wider tail at auction.

- The space had little reaction to Japanese PM Abe being re-elected leader of

the ruling LDP Party, as he won a comfortable majority.

- Focus today turns to the 1-5 & 10-25+ Year Rinban operations from the BOJ &

domestic CPI data ahead of the long holiday weekend.