Futures Supported Ahead Of 144.00, 10yr JGB Yield Back Close To Late April Highs

JGB futures got to fresh lows back to late April not long after the open. We hit 144.04, but sit higher now, last at 144.24, -.32. Recall April 26 lows came in at 143.61 for JBM4.

• Some hawkish headlines from the BoJ Summary Of Opinions at the April policy meeting have weighed on the space. The opinions of some members noted that the rate hike path may be stronger than the market expects, while others noted that rate hike discussions need to deepen.
• At the margin this may raise risks of follow up tightening at the June meeting, although other members noted overall financial conditions are expected to remain accommodative.
• Adding downside pressure for JGBs is the softer US Tsy futures backdrop, although overall moves have been modest at this stage.
• In the cash JGB space, the 10yr yield is back towards 0.92%, up 3.5bps. The 5 and 7yr tenors are also up over 3bps. Late April highs in the 10yr came in at 0.933%. The 10yr swap is near 0.99%, still sub late April highs.