Following Wider Risk With A Lower Beta

JGBs meandered through morning trade, trading with a low beta to the wider swings in the wider risk backdrop (as is the norm). JGB futures initially showed lower vs. late overnight session levels, before recovering, hitting the lunch break +1. Cash JGB trade has been very limited, with the major cash JGB benchmarks running -/+0.5bp vs. Friday’s closing levels.

• There hasn’t been much in the way of notable domestic headline flow to assess since the Tokyo re-open, leaving wider swings in risk appetite in the driving seat.
• Note that domestic PPI data topped expectations (+10.0% Y/Y vs. BBG median +9.4%) and may have fed into the early, limited downtick in the JGB space.
• 10-Year JGBi supply headlines domestic matter this afternoon.