Futures Hit The Break Off Worst Levels, Super-Long Paper Richens

JGB futures chewed away at the early Tokyo downtick to finish the morning session -16, but never got anywhere near neutral levels. The weakness in futures since yesterday’s close continues to leave the 7- to 10-Year zone of the cash JGB curve under water (albeit only a mere 0.5bp cheaper on the day), while the remainder of the major benchmarks sit little changed to 2.5bp richer, with the super-long end outperforming.

• Domestic headline flow remains somewhat limited, outside of the IMF once again suggesting that the BoJ should allow its YCC scheme to become more flexible.
• More widely, macro headline flow has also been restrained.