Futures Stronger, Light Calendar Today, 20-Year Supply Tomorrow

JGB futures are trading on a high note in the Tokyo afternoon session at 148.94, +19 compared to the settlement levels.

• Apart from the previously mentioned Summary of Opinions from the BoJ's June meeting, which included a board member's suggestion to discuss a potential revision to the treatment of yield-curve control (See link ICYMI), there have been minimal domestic factors worth highlighting.
• Given the absence of significant local news, it appears that the domestic market has been impacted by the slight uptick in US tsys during Asia-Pac trading, which was triggered by the political unrest in Russia over the weekend.
• The cash JGB curve bull flattens beyond the 1-year zone in Tokyo afternoon trade. Beyond the 1-year zone, yields are 0.3-1.8bp lower with the 30-year zone as the best performer. The benchmark 10-year yield is 0.5bp lower at 0.364%, below the BoJ's YCC limit of 0.50%. The 20-year is 1.1bp lower at 0.960%, showing no concession on the curve, ahead of tomorrow’s supply.
• Swap rates are lower beyond the 2-year with swap spreads wider across the curve.
• The local calendar tomorrow sees the release of Coincident & Leading Indicators for April (final), along with 20-year supply.