Futures Off Best Levels in Wake Of BoJ Purchase Announcement, Twist Steepening Maintained

JGB futures edge away from best levels, despite the aforementioned round of unscheduled Rinban purchases (becoming the norm in recent sessions), owing to the step down in the size of 5- to 10-Year JGB purchases (Y150bn from Y300bn previously). That leaves the contract +18. Meanwhile wider cash JGBs continued to observe a twist steepening move, with a matching stepdown in the size of off-schedule 10- to 25-Year purchases (Y150bn from Y300bn previously) aiding that move. Fixed rate operations out to 10s may have provided some support for the 1- to 5-Year zone, which is now firmer on the day, with the major cash benchmarks now sitting 2.0bp richer to 1.5bp cheaper, with 7s still leading and the curve pivoting around 10s.