Core FI Marginally Firmer In Asia

T-Notes last +0-03+ at 132-16+, sticking to a 0-05+ range overnight, while cash Tsys are little changed to 1.0bp richer on the day. There has been a distinct lack of tier 1 headline flow, both over the weekend and since the broader markets reopened. Focus has therefore fallen on the simmering Israeli-Palestinian tensions and apparent distaste from various corners of the UK political sphere re: certain Brexit matters. Some worry evident in the Asia-Pac region re: COVID (most notably in Taiwan) likely provided some incremental support to Tsys. Elsewhere, there was no immediate reaction in the space to the softer than expected round of the Chinese monthly economic activity data, with the releases still reflecting significant bounces in Y/Y terms (albeit slower growth vs. what was seen March). Elsewhere, China's surveyed unemployment rate moved lower, now printing in line with late '19 levels. China's NBS stressed that the Chinese economic recovery continues to be "uneven."

• A downtick in the Nikkei 225 and some residual spill over from Friday's afterhours trade supported the JGB space during the Tokyo session. Futures last +9. The major cash benchmarks richened with 7s leading the way (trading a little over ~1.0bp firmer), perhaps indicating that the move was particularly aided by the bid in futures. 10-Year JGBi supply passed smoothly, while the space looked through a firmer than expected round of April PPI readings.
• Aussie bond futures were little changed to a touch higher, with the cash curve playing catch up to the flattening witnessed in the final overnight session of last week, as longer dated ACGBs richened by ~4.0bp. YM +0.5, XM +4.0. A lack of local input was evident in early dealing this week, although the A$ IG issuance pipeline is building. Focus falls on this week's major domestic risk events (the RBA's May meeting minutes and the local labour market report).