Futures Hold Near Recent Lows, Q2 Capex Out Today

JGB futures finished up at 144.58, -.14 versus settlement levels. Intra-session lows from Friday printed just under 144.50 levels, which followed the stronger than expected Tokyo August CPI print.

• Since the second half of August, futures has spent little time sub 144.50. Note August 6 lows for September future came in at 144.30.
• In terms of US Tsy futures, we were biased lower on Friday as Core PCE inflation was in line but consumer spending and MNI Chicago PMI surprised to the upside (softer UMichigan consumer inflation expectations helped limit the hawkish follow-through).
• In the cash JGB space, the 10yr yield finished up on Friday just under 0.90%. We haven't been able to spend much time above this level since the sharp off period in the first part of August. The 10yr swap rate was last near 0.91%.
• On the data front today we have we have Q2 Capex spending, an important component in terms of GDP revisions. The market looks for headline spending to be at 10.0% y/y, (prior was 6.8%). Also out is the final Jibun Bank PMI print for August.
• The supply front is quiet today, but we have 10yr bond auction tomorrow.