Cheaper, Narrow Ranges, 5Y Supply Tomorrow

JGB futures are holding weaker, -15 compared to settlement levels, after dealing in a relatively narrow range.

• There hasn’t been much in the way of domestic drivers to flag, outside of the previously outlined Labor & Real Cash Earnings and Current-Account Surplus data, and remarks from BoJ Governor Ueda that he had achieved his goal to change the bank's monetary stimulus into a simpler framework.
• (Bloomberg) -- Japan markets have a positive outlook on high sustained inflation and significant household savings, according to Jennifer Hsui, global head of index equity investments at BlackRock. (See link)
• Cash US tsys have extended Friday’s post-payrolls cheapening in today’s Asia-Pac session, with benchmark yields 1-3bps higher.
• Looking ahead, the market’s focus is likely on US CPI and March FOMC minutes on Wednesday and PPI on Thursday.
• Cash JGBs are mostly cheaper across the curve, with yields -0.8bp lower (10-year) to 1.6bps higher (2-year). The benchmark 5-year yield is 0.5bps higher at 0.387% ahead of tomorrow’s supply.
• Today’s BoJ Rinban Operations covering 1-3-year, 5-10-year and 25-year+ JGBs showed mixed results. Spreads were positive but the offer cover ratios were lower than previous outings.
• Swap rates are flat to slightly higher across maturities. Swap spreads are mixed.
• Tomorrow, the local calendar will see the Consumer Confidence Index and Machine Tool Orders data.