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Free AccessCurve Twists Steeper
The JGB curve has seen some twist steepening this morning, with paper out to 20s little changed to 1.0bp richer, while 30s and 40s have seen cheapening of 1.0-1.5bp, perhaps pointing to some worry re: the impact of the impending supplementary budget on long end issuance. Technical steepener interest may also be present, after the likes of the 10-/30-Year year yield spread tagged a multi-month low in recent sessions. Futures held a tight range during the Tokyo morning, hitting the lunch bell 4 ticks below settlement levels.
- Local headline flow has been relatively light, with Finance Minister Suzuki headlining, noting that Japan will continue to monitor FX markets and that currency stability remains important. Elsewhere, Suzuki noted that the government is still considering the details when it comes to cash handouts in the upcoming fiscal package.
- The latest round of BoJ Rinban ops revealed the following offer/cover ratios:
- 1- To 3-Year: 2.06x (prev. 3.07x)
- 3- To 5-Year: 2.05x (prev. 2.87x)
- 10- To 25-Year: 2.44x (prev. 3.03x)
- The downtick in the cover ratios may support the space in early afternoon dealing.
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.