Free Trial

Futures Richer, US Tsys Cheaper, BoJ Decision In Focus

JGBS

At the Tokyo lunch break, JGB futures are richer (JBU4 at 143.71) but off session highs, +25 compared to the settlement levels, ahead of today’s BoJ Policy Decision.

  • (Bloomberg) "The BoJ has announced its policy decision at 12:01pm in Tokyo on average since Kazuo Ueda became governor in April 2023."
  • According to MNI’s technicals team, key resistance remains at 145.95, the Mar 28 high. A break would signal the scope for a climb towards the bull trigger at 147.74, the mid-January high. The bounce off late May lows has called into question the sustainability of the bear trend this year, despite the contract recently trading through key support at 143.44, the Nov 1 low. This exposes 141.65, a Fibonacci projection.
  • We anticipate the BoJ will leave its policy rate unchanged, in line with consensus. Accordingly, the market's focus is likely on whether there is any announcement regarding balance sheet policy and the future pace of JGB purchases. (See MNI BoJ Preview here)
  • Cash US tsys are 1-2bps cheaper across benchmarks in today’s Asia-Pac session after yesterday’s rally.
  • The cash JGB curve has bull-flattened, with yields flat to 4bps lower. The benchmark 10-year yield is 1.9bps lower at 0.956% versus the cycle high of 1.101%.
  • Swaps are richer out to the 30-year zone, with rates 1-2bps lower. Swap spreads are mostly wider.
221 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.

At the Tokyo lunch break, JGB futures are richer (JBU4 at 143.71) but off session highs, +25 compared to the settlement levels, ahead of today’s BoJ Policy Decision.

  • (Bloomberg) "The BoJ has announced its policy decision at 12:01pm in Tokyo on average since Kazuo Ueda became governor in April 2023."
  • According to MNI’s technicals team, key resistance remains at 145.95, the Mar 28 high. A break would signal the scope for a climb towards the bull trigger at 147.74, the mid-January high. The bounce off late May lows has called into question the sustainability of the bear trend this year, despite the contract recently trading through key support at 143.44, the Nov 1 low. This exposes 141.65, a Fibonacci projection.
  • We anticipate the BoJ will leave its policy rate unchanged, in line with consensus. Accordingly, the market's focus is likely on whether there is any announcement regarding balance sheet policy and the future pace of JGB purchases. (See MNI BoJ Preview here)
  • Cash US tsys are 1-2bps cheaper across benchmarks in today’s Asia-Pac session after yesterday’s rally.
  • The cash JGB curve has bull-flattened, with yields flat to 4bps lower. The benchmark 10-year yield is 1.9bps lower at 0.956% versus the cycle high of 1.101%.
  • Swaps are richer out to the 30-year zone, with rates 1-2bps lower. Swap spreads are mostly wider.