Cheaper, Narrow Ranges, Tracking JGBS & US Tsys, CPI Monthly Next Wednesday

ACGBs (YM -1.0 & XM -5.5) are cheaper after dealing in a relatively narrow range during the Sydney session. With the domestic calendar light (Judo Bank preliminary PMIs only data), local participants have been on headlines, JGBs and US tsys watch.

• JGBs pared US tsy-linked morning weakness into the BOJ policy decision. The arguably dovish hold by the BOJ saw JGB futures spike higher in the early rounds of the Tokyo afternoon session. However, those gains have been unwound. The market now awaits BOJ Governor Ueda’s press conference at 3:30pm Tokyo time, 07:30 BST.
• After pushing to multiyear highs on Thursday, long-dated US tsys are dealing little changed in Asia-Pac trade.
• Cash ACGBs are 1-5bps cheaper, with the AU-US 10-year yield differential 1bp lower at -14bps.
• The 3s10s swap curve has twist-steepened, with rates 2bp lower to 4bps higher. EFPs are tighter.
• The bills strip is richer, with pricing +1 to +2
• Next week the local calendar is light until the release of the CPI Monthly for August on Wednesday.
• Monday sees panel participation by RBA Assistant Governor Jones at a Conference on Financial Technology, Climate Change, and Challenges.
• Next Wednesday the AOFM plans to sell A$800mn of the 2.25% May-28 bond.