Futures Gain Overnight On U.S. Labour Market Data

Softer than expected U.S. labour market data helped JGB futures pare Tokyo losses in overnight trade, leaving the contract +19 at the close of post-Tokyo dealing, as market participants once again reassessed the outlook for Fed policy.

• Local headline flow has seen LDP Secretary General Motegi note that Japan doesn’t intend to lift taxes or issue debt to facilitate PM Kishida’s measures aimed at supporting families (Finance Minister Suzuki recently noted that the package will be fully unveiled in June). Motegi stressed the need for spending reform and the potential for various forms of insurance premiums when it came to potential funding sources for the scheme.
• Looking ahead, BoJ Rinban operations covering 1- to 5- & 10- to 25-Year paper (the first Rinban since the well-documented tweak to the purchase bands in the Q2 outline) headline the local docket on Wednesday, with final services & composite PMIs also slated.