Futures Stronger As The US Tsy Curve Bull-Steepens, Heavy Local Calendar

In post-Tokyo trade, JGB futures are richer, closing +11 compared to settlement levels, after US tsys extended November's rally, especially at the short end. The US tsy curve bull-steepened, with yields 7-9bps lower.

• The day’s moves in US tsys were initially influenced by subdued inflation data in Germany. This trend gained momentum as it found additional support from softer-than-anticipated core PCE inflation. Notably, these movements occurred despite an upward adjustment in real GDP growth, which was revised to an even more robust 5.2% annualised rate in Q3, up from the initial estimate of 4.9%.
• Fedspeak didn’t provide any pushback, with Bostic (’24) seeing evidence that tighter monetary policy is biting harder into economic activity and Mester (’24 voter retiring in June) reiterating she sees Fed policy on a good footing. The Beige Book then went on to show moderation compared to the mid-October update across output, pricing and labour markets.
• Today, locally we have a full data calendar. First up are retail sales for Oct, along with IP and weekly investment flows. Later on, housing starts and consumer confidence are due. Also, note we also hear from the BOJ's Nakamura at 10:30 am local time (01:30 GMT).
• The MOF plans to sell Y2.9tn of 2-year JGBs.