Futures Higher In Overnight Dealing, Q2 Capex & Company Profits Due

In post-Tokyo trade, JGB futures are stronger, closing +11 compared to settlement levels, after US tsys trod water. US tsy yields finished 1-2bps lower across the major benchmarks, with the wings marginally outperforming. The latest round of US data printed broadly in line, with the core PCE deflator at +4.2% y/y versus +4.1% previously. US tsys observed narrow ranges. The proximity to today's Non-Farm Payrolls data perhaps limited activity in the space.

• The Federal Reserve may be slower to cut rates than many market participants expect, according to Bridgewater Associates co-chief investment officer Karen Karniol-Tambour. “When you look at what it takes to get fast rate declines, usually you need the economy collapsing pretty quickly,” she told Bloomberg. “That’s very far from where we are today.”
• Bloomberg reports that the weaker yen stemming from the BoJ's loose monetary policy has helped the economy and acted as a “reverse Plaza Accord,” according to Credit Agricole. “If the BoJ tightens monetary policy prematurely on the belief that a weak currency is bad, the tailwinds from a weak yen, combined with a global economic slowdown, will likely disappear,” they wrote. “Japan’s economy could fall back into a state of deflation and stagnant growth.” (See link)
• Today the local calendar sees Capital Spending and Company Profits for Q2, along with Jibun Bank PMI Manufacturing for August (Final).