Futures Firm Overnight

The rally in wider core global FI markets allowed JGB futures to move higher in overnight trading, with the contract finishing 23 ticks higher than Tokyo settlement, going out at best levels of the post-Tokyo session. The modest early Asia uptick in U.S. Tsy futures may underpin the overnight bid in JGB futures at the Tokyo re-open.

• Note that JGB futures now sit at the highest level observed since 10 March.
• There hasn’t been much in the way of meaningful domestic news flow to digest since the Tokyo close, with continued focus on the potential for a record uplift in the Japanese minimum wage evident, although it has been the wider geopolitical and U.S. data influences that have dominated price action.
• 10-Year JGB supply headlines the domestic docket on Tuesday.