Free Trial
CANADA

Analyst BoC Rate Paths Ahead Of CPI

GBPUSD TECHS

Directional Triggers Defined

EURUSD TECHS

Trading Below Last Week’s High

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access

Curve Twist Steepens

JGBS

JGB futures chipped away at their overnight losses during the Tokyo session and now sit 6 ticks below yesterday’s settlement level, over 30 ticks off their overnight low, although trading conditions remain impaired.

  • There wasn’t much in the way of local news to digest after the re-open (PM Kishida & Finance Minister Suzuki offered little in the way of meaningful rhetoric), with cross-market impetus helping futures to pare some of its overnight losses during the morning
  • Cash JGBs out to 20s are generally within 0.5bp of yesterday’s closing levels, trading on the richer side, although the broader cheapening observed in the global fixed income space on Monday has seemingly facilitated ~1.5bp of cheapening for 30s and 40s, with some twist steepening in play on the curve as a result.
  • The exception to rule for paper out to 20s is 5s, with outperformance there (equating to 1.5bp of richening) aided by 5-Year JGB supply, which was absorbed smoothly enough. The low price of the auction matched broader estimates (as proxied by the BBG dealer poll), while the price tail saw a very modest widening, although remained tight in the grander scheme of things. Things were a little softer on the cover ratio side, with the bid/cover moving to the lowest level observed at a 5-Year JGB auction since the COVID-induced vol. of early ’20 (likely on the well-documented market functioning issues).
  • Wednesday’s local docket will be headline by the latest round of BoJ Rinban operations.
244 words

To read the full story

Why Subscribe to

MarketNews.com

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.

JGB futures chipped away at their overnight losses during the Tokyo session and now sit 6 ticks below yesterday’s settlement level, over 30 ticks off their overnight low, although trading conditions remain impaired.

  • There wasn’t much in the way of local news to digest after the re-open (PM Kishida & Finance Minister Suzuki offered little in the way of meaningful rhetoric), with cross-market impetus helping futures to pare some of its overnight losses during the morning
  • Cash JGBs out to 20s are generally within 0.5bp of yesterday’s closing levels, trading on the richer side, although the broader cheapening observed in the global fixed income space on Monday has seemingly facilitated ~1.5bp of cheapening for 30s and 40s, with some twist steepening in play on the curve as a result.
  • The exception to rule for paper out to 20s is 5s, with outperformance there (equating to 1.5bp of richening) aided by 5-Year JGB supply, which was absorbed smoothly enough. The low price of the auction matched broader estimates (as proxied by the BBG dealer poll), while the price tail saw a very modest widening, although remained tight in the grander scheme of things. Things were a little softer on the cover ratio side, with the bid/cover moving to the lowest level observed at a 5-Year JGB auction since the COVID-induced vol. of early ’20 (likely on the well-documented market functioning issues).
  • Wednesday’s local docket will be headline by the latest round of BoJ Rinban operations.