Futures Rise For First Time In October

The PBOC drained a net CNY 90bn via OMOs today as the drain of pre-Golden Week liquidity continues. Repo rates higher after dropping late on yesterday, but remain below the previous day's highs. Futures are higher as risk off sentiment takes hold in Asia, Chinese equity markets down around 0.7% at the time of writing, 10-Year future up 6.5 ticks, the first up day in October after being closed for Golden week – contract highs hit in September sit around 100.155. In Chinese press there was a piece in the 21^st Century Business Herald which positing that the PBOC could cut banks RRR as soon as October. The latest development in the Evergrande saga sees some holders of dollar bonds with interest payments due Monday saying they had yet to receive them, while in a sign the situation is affecting others in the real estate sector Sinic has said it doesn't expect to pay the principal or interest payments due on October 18.