Futures Gap Higher At The Open

Futures opened higher, pushed upwards by the move in US t-notes, since opening some 35 ticks higher the contract has moved in a range, last up 37 ticks at 126.85. In the cash space yields are lower, flattening on the curve seen, 2-/20-year yield 1.5bps tighter, 10-year yield down 1.4bps at 2.011%.

• Some caution over COVID-19 infections. South Korea reported 731 daily new coronavirus cases in the past 24 hours, rebounding to over 700, the most in over three months, as cluster infections across the country continued to pop up sparking concerns over another wave of the pandemic. Wednesday's daily caseload was the highest since Jan. 7, when 869 new cases were confirmed. The number of new cases remained in the 500s over the last two days due largely to fewer tests conducted over the weekend.
• Data earlier showed unemployment fell for second month in March, though the decline was smaller than the 1.4ppts seen in February after the government resumed its public sector jobs programme. The March print came in at 4.0% from 3.9% previously, in line with estimates. The gains are attributed to bumper exports and robust consumer confidence translating to domestic demand. The print represents the first gain in jobs since the start of the pandemic.
• Elsewhere, South Korea's export prices rose in March, marking the fourth straight monthly gain amid a modest recovery in exports. Export prices rose 5.6% in March, while import prices rose 9%.
• Meanwhile, the IMF have commented on South Korean debt levels warning that while the current rise in debt due to the pandemic is manageable, it needs to closely consider its future spending plans to ensure its debt burden doesn't become unmanageable as the population ages. South Korea's government debt load is projected to jump from 53.2% of gross domestic product this year to 69.7% by 2026.
• Markets look ahead to the Bank of Korea rate announcement tomorrow.