Futures Holding An Uptick At Lunch

At the Tokyo lunch break, JGB futures are sitting mid-range with an uptick, +1 compared to the settlement levels.

• There have been no economic releases today.
• Bloomberg reports that bond traders are on guard for a further five-basis-points increase in benchmark Japanese bond yields amid speculation that it would trigger another foray into the market by the central bank. (See link)
• Japan sold $3.21 trillion worth of bonds this year as of Aug. 3, according to Bloomberg calculations using official data. Issuance was down 9.8% compared to the same period last year. The dollar value of the sales is calculated using the USDJPY exchange rate on the day of the issuance and might differ from the official figures. (See link)
• Cash JGBs are flat to 2.6bp cheaper (30-year zone) across the curve. The benchmark 10-year yield is unchanged at 0.653%, above BoJ's YCC old limit of 0.50% but below its new hard limit of 1.0%.
• The swaps curve has twist steepened , pivoting at the 7-year, with rates 0.2bp lower to 1.9bp higher (20-year). Swap spreads are tighter out to the 5-year and mixed beyond.