Futures Higher In Line With US Tsys’ Post-CPI Rally

In post-Tokyo trade, JGB futures are richer, closing +23 compared to settlement levels, after US tsys finished 3-11bps richer, with the curve steeper, following US CPI data that more-or-less printed in line.

• CPI m/m (0.3% vs. 0.2% est), y/y (3.4% vs. 3.2% est); Ex Food and Energy m/m (0.3% vs. 0.3% est), y/y (3.9% vs. 3.8% est).
• The 10-year yield was 6bps lower at 3.97% versus Thursday's peak of 4.066%. Notably, it was the first close below 4% since January 3.
• The BoJ is considering cutting its price outlook for fiscal 2024 to the mid-2% range, Jiji reports without attribution. The most recent outlook, given in October, was 2.8%. This would reflect the decline in oil prices. Note: BoJ is scheduled to give its latest price outlook on Jan. 23 (BBG)
• The latest insight from our policy team in Tokyo points to an April lift-off for the BoJ, but uncertainty is evident in terms of what will then become of the main interest rate target (see this link for more details. The piece was out late yesterday).
• Today, the local calendar sees Weekly International Investment Flows, BoP Current Account Balance and Bank Lending data, along with 30-year supply.