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Futures Sharply Higher After BoJ Gov. Ueda's Dovish Comments

JGBS

In post-Tokyo trade, JGB futures are sharply higher, closing +41 compared to settlement levels, dovish comments from BoJ Governor Ueda.

  • At a press conference after a gathering of Group of 20 finance chiefs and central bankers in India Tuesday, Ueda indicated it would take a shift in the bank’s assessment for stably achieving its inflation target to change its stance for persistent monetary easing. Adding, “We check the premise at every policy meeting, and I would like to say that, unless the premise is shifted, the whole story will remain unchanged,”. (See linkICYMI)
  • US tsys finished the NY session with the 2-year yield up 2.3bp at 4.766% while the 10-year was 2.1 bp lower at 3.785%. That said, yields were well off early session lows set after June retail sales came out weaker than expected at +0.2% vs. +0.5% est (May up revised to +0.5%, however, from 0.3%). June industrial production also disappointed (-0.5% vs. 0.0% est) after a downwardly revised May.
  • The local data calendar is empty today, with the main focus resting on Friday's national CPI print.
  • The MoF does however plan to sell Y500bn at a Liquidity Enhancement Auction for OTR 1-5-year JGBs.

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