Core FI In Standby Mode, Fed Decision Looms Large

There was little movement across core FI space in Asia hours, with an Australian holiday limiting activity. All eyes were on the imminent policy decision from the Fed, who are expected to pave the way for a rate hike in March.

• T-Notes edged higher, while staying comfortably within the confines of Tuesday's range. TYH2 last trades +0-02 at 128-06, amid very subdued volatility. Eurodollar futures sit 0.5-1.5 tick lower through the reds. The Tsy curve flattened at the margin, with yields last seen 0.5-1.2bp higher.
• JGB futures slipped into the Tokyo lunch break but regained poise in afternoon trade. JBH2 sits at 150.95, just shy of previous settlement. Cash JGB curve runs slightly steeper on the back of some marginal weakness in the super-long end. The space looked through the summary of opinions from the BoJ's monetary policy meeting held last week. A couple of members stressed the need to clearly communicate the Bank's intention to keep powerful monetary easing in place to the public, which Governor Kuroda did during his press conference.
• Daytime trading was closed in Australia owing to a public holiday down under.