Futures Lower, Mar Tokyo CPI Close To Forecasts, Unemployment Rate Ticks Up

JGB futures (JBM4) finished post Tokyo trade at 145.77, -.11. Core global yields finished mostly higher in Thursday trade, which likely saw some negative bias imparted on JGB futures. Liquidity should be lighter today given many markets are shut for Good Friday.

• On the data front, we have just had Tokyo CPI print for Mar. The headline came in at 2.6% y/y, versus 2.5% forecasts (which was also the revised Feb outcome). Core, ex fresh food rose 2.4% y/y, in line with forecasts, likewise for the core measure which excludes energy as well, 2.9% y/y. Both measures saw lower y/y momentum compared to Feb.
• Also printing was the Feb jobless rate, which was higher than forecast at 2.6%, against a 2.4% expectation. The job-to-applicant ratio slipped to 1.26, versus 1.27 expected, so some slight softening signs in the jobs market.
• We have further data coming up shortly, with Feb retail sales and IP out.
• In the cash JGB space we finished up at 0.71% for the 10yr yesterday, while the 2yr was near 0.19%. The 10yr is not far off March to date lows. US-JP 10yr spreads sit a touch higher but at +349bps, remain within recent ranges.
• 10yr swap rates sit near 0.83%, which is around fresh lows back to mid Jan.
• On the supply side we have a 2yr debt sale, with the MoF selling ¥2.6trillion, down around ¥300bn from the prior 2yr sale in Feb (BBG).