Core FI Garner Strength With Familiar Concerns In Focus

T-Notes posted a small gap higher at the Tokyo re-open and last trade +0-03+ at 137-23+, with the conspicuous lack of breakthroughs in U.S. fiscal talks and Brexit negotiations providing the main talking points. Cash Tsy curve has bear flattened a tad, with yields last seen 0.2-1.4bp richer. Eurodollars run unch. to +1.0 tick through the reds.

• JGB futures kicked off on the front foot and have extended gains thereafter. The contract finished the morning session at 152.14, 4 ticks above last settlement. Cash JGB yields sit lower across a flatter curve, with 20-Year debt supply due later today. Elsewhere, the latest reading of Japanese PPI matched exp., while the MoF's Business Survey showed improvement in the m'fing sector. Familiar fiscal matters continue to provide interest locally.
• The RBA offered to buy A$2.0bn of ACGBs with maturities of Nov '28 - May '32, excluding Dec '30 under its scheduled purchase scheme, in addition to proposing to buy A$2.0bn of ACGBs with maturities of Apr '23 - Apr '24 to enforce its 3-Year yield target (a deviation from buying just Apr '24). Australian consumer inflation expectations remained unch. vs. the prior reading of +3.5%. Aussie bonds have picked up a bid, YM +1.4 & XM +3.5, hitting session highs. Cash ACGB yields trade 0.7-3.9bp lower across a flattened curve at typing. Bills last seen unch. to -1 tick through the reds. The AOFM auctioned Mar '21 & Jul '21 Notes, with the former sold at the low yield of -0.01%, the first negative yield at an offering of notes of that tenor.