Futures Sitting At Overnight Closing Levels, Cash US Tsys Twist Flatten

JGB futures are sitting near the overnight closing level of 148.54, +10 compared to settlement levels, after reversing the initial uptick at the opening of the Tokyo session.

• Cash tsy curve twist flattens at the opening of Asia-Pac trade after the Memorial Day holiday. Yield changes range from +1.9bp (2-year) to -4.7% (20-year).
• There hasn’t been much on the local news front other than the previously outlined April jobless data that printed 2.6% versus expectations of 2.7%, from 2.8% prior. The job-to-applicant ratio printed in line with expectations at 1.32, unchanged from March. The data didn’t appear to have a material impact on the market, as expected.
• Cash JGBs are richer beyond the 1-year zone with yield movements ranging from -0.4bp (4-year) to -1.1bp (7-year). The benchmark 10-year yield is 0.8bp lower at 0.433%, below the BoJ's YCC limit of 0.50%.
• The 2-year JGB is trading 0.4bp richer at -0.063%, showing little concession, ahead of the planned sale Y2.9tn of supply.
• Swap rates are lower with the curve flatter out to the 10-year zone, and slightly steeper beyond. Swap spreads are mixed.