Futures Come Under Pressure Overnight On Global FI Slide, 10-Year YCC Limit Eyed

JGB futures shed a further 13 ticks in overnight trade finishing just off session lows, as moves in wider core global FI markets (largely linked to data releases) applied pressure.

• This comes after 10-Year JGB yields showed ~0.5bp through the upper boundary of the BoJ’s -/+0.50% YCC band into the bell on Tuesday, before retracing to sit around 0.50% at the close.
• Be on the lookout for unscheduled BoJ Rinban operations if further cheapening in JGBs catches hold, with market participants not willing to give outgoing BoJ Governor Kuroda any reprieve during the final weeks of his term.
• Local headline flow has been fairly limited in the time since the Tokyo close.
• Services PPI data and a speech from BoJ’s Tamura headline the local docket today.