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Futures Stronger Ahead Of 40Y Supply, BoJ Tamura Delivers Speech and BoJ Gov. In Parliament

JGBS

In Tokyo morning trade, JGB futures are stronger, +5 compared to settlement levels, after reversing the overnight downtick.

  • Today, the local calendar has a light data schedule.
  • BoJ Board Member Tamura in Aomori says: Accommodative Financial Conditions To Stay; BOJ Took First Step Toward Monetary Policy 'Normalization'; BOJ Will Slowly and Steadily Normalize Monetary Policy; Side Effects of Monetary Easing Will Likely Remain; and Expect Positive Cycle of Wages, Prices to Continue.
  • BoJ Governor Ueda is also scheduled to appear in Parliament from 10:47 am local time – BBG.
  • Cash JGBs are dealing slightly mixed, with yield movements bounded by +0.2bp to -0.7bp. The benchmark 10-year yield is 0.1bp higher at 0.74% versus the YTD high of 0.801%.
  • The 40-year yield is little changed ahead of supply.
  • The swaps curve has twist-steepened, pivoting at the 20s, with rates 3bps lower to 2bps higher. Swap spreads are mixed.

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