Core FI Lacks Sense Of Direction In Asia

T-Notes traded either side of their late NY levels during Asia-Pac hours, with little in the way of market moving headlines witnessed, which went alongside relatively sedate core market trade as China returned from the LNY break. T-Notes last +0-05+ at 135-29+, with cash Tsys sitting unchanged to marginally cheaper on the day. The latest round of vaccine related headline flow (which was negative at first glance, although some of the details were a little more upbeat) saw no tangible market reaction. The uptick from yesterday's lows resulted in some downside interest in Asia-Pac hours, with the TYJ1 134.50/133.50 put spread lifted via a 3.0K block trade. We also saw a FV/TY flattener block (3,630 FVH1 vs. 2,260 TYH1) Eurodollar futures print 0.25 to 1.5 ticks higher through the reds, with a sizable 50K screen buyer of EDZ2 seen in Asia-Pac hours.

• JGBs firmed in the Tokyo morning, but drifted away from best levels on the back of soft 20-Year JGB supply, with futures last 9 ticks above yesterday's settlement levels. Elsewhere, 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.
• Aussie Bonds mostly tracked the broader impetus, as opposed to local issues. The latest Australian labour market report was virtually as expected, with a nudge lower in the unemployment, underemployment and underutilisation measures. YM -0.5, XM +3.5.