Futures recovered from Tokyo lows on the.......>

JGBS: Futures recovered from Tokyo lows on the back of a solid 5-Year JGB

auction, allowing the mild pre-auction concession, that was driven by the belly

of the cash curve, to unwind. Contract +11 ticks. To recap, it looked like

concession coupled with the elevated level of the 2-/5-/10-Year fly generated

some demand at auction, with the tail disappearing, cover ratio edging higher

and low price topping dealer exp. (as proxied by the BBG dealer poll).

- Elsewhere, BoJ Governor Kuroda went over old ground at the latest BoJ branch

manager meeting, with a reiteration of the Bank's forward guidance, as well as

noting that the Japanese economy is likely to continue expanding moderately as a

trend, and that developments overseas, a well as domestic natural disasters,

have had an effect on the economy. This was borne out in the summary of the

Bank's Regional Economic Report, which saw a downgrade for the assessment of 3

regions, while the other 6 saw their assessment left unchanged.

- Prelim machine tool orders data was, in one word, woeful, reflecting the

impact of the sales tax hike.

- PPI, 5-10 Year BoJ Rinban ops & 12-Month supply headline tomorrow's docket.