Futures A Touch Lower Overnight, Firmer Than Expected Tokyo CPI & BoJ Rinban Plan Eyed

JGB futures shed 7 ticks in overnight trade, generally taking cues from the wider core global FI space, finishing off of worst levels of the session, in what proved to be contained trade. There wasn’t much follow through on a breach of Tokyo session lows, before the tick away from orst levels of overnight trade.

• We haven’t seen much in the way of meaningful domestic headline flow since the Tokyo close, with most of the focus falling on the recently released Tokyo CPI data (which provides a more timely read than the national print). Firmer than expected readings across the board in the Tokyo CPI suite, headlined by the move in the excluding fresh food and energy print, have the potential to provide some cheapening impetus after the market open.
• Elsewhere, there was an unexpected uptick in the unemployment rate in February, alongside a modest downtick in the job-to-applicant ratio. Don’t expect this to impact JGBs.
• Retail sales and preliminary industrial production data will cross shortly after the JGB open. Further out, the BoJ will release it’s quarterly Rinban plan after hours. Several sell-side names have suggested that the plan could reveal some tweaks to the purchase bands, with some outlining the potential for a reduction in lower limits of the purchases from the 5- to 10-Year bucket to further out the curve given the recent richening in the space and recent purchase tweaks from the Bank.