Futures Add To Post-BoJ Gains In Trade Ahead Of The Weekend

JGB futures added to the post-BoJ decision richening in overnight trade ahead of the weekend, closing at 148.80, +20 compared to settlement levels. Cash US tsys finished 6-11bp stronger across the curve in NY trade on Friday following some hopeful signs that services sector inflation was receding. Non-housing core services (Bloomberg’s calculation) cooled from +0.35% M/M to +0.2%, the softest print since Jul’22.

• JBM3's strong recovery from 147.27, the April 18 low, confirms the corrective nature of the pullback between March 22- April 18, according to MNI’s technical analyst. Attention remains on 149.53, the March 22 high.
• On Friday, the BoJ announced that it would maintain its ultra-easy policy settings but removed its forward guidance on rates, which is intended to provide more flexibility in future policy decisions. Although this appeared to signal a shift towards a more policy-neutral outlook, the BoJ will conduct a formal long-term review of monetary policy, which is expected to take 12-18 months. As a result, market expectations for a swift normalisation of policy were tempered, despite Governor Ueda's statement that policy changes, including normalisation, could be made during the review process.
• The local calendar is light today with April’s Jibun Bank Mfg PMI (Final) and Consumer Confidence slated for release.