Back From Best Levels On Weak 20-Year Supply

JGBs firmed in the Tokyo morning, but drifted away from best levels on the back of soft 20-Year supply, with futures closing 7 ticks above yesterday's settlement levels, a little below the overnight close.

• In terms of auction specifics, the tail widened vs. prev. and cover ratio softened back towards the multi-year lows witnessed at December's round of 20-Year supply. The matters flagged in our preview likely kept potential bidders sidelined/limited the aggressiveness shown in bids. The one saving grace was that the low price met broader dealer expectations, as proxied by the BBG dealer poll.
• A meeting between BoJ Governor Kuroda and Japanese PM Suga provided no deviation from familiar BoJ rhetoric re: the BoJ's ongoing monetary policy review.
• Elsewhere, the latest round of weekly international security flows data from the Japanese MoF revealed that foreign investors were net sellers of Japanese bonds after 4 consecutive weeks of net purchases. This resulted in the 4-week rolling sum of the measure retracing to near enough flat levels.
• 1-10 Year BoJ Rinban operations, national CPI data and the flash PMI readings headline locally on Friday.