Futures Supported On Dips, 10yr Swap Rate To Fresh Mutli Month Lows

The early bias in JGB futures was to the downside, but follow through has been limited. We got to 145.71 not long after the open, but now sit back at 145.76, -.12.

• Earlier data prints were mixed, with Tokyo CPI close to expectations, while some softness was evident in labour market figures. Retail sales were firmer, but IP weaker (impacted by auto suspensions). In aggregate not enough to shift the economic outlook.
• In the cash JGB space, yields are steady. The 10yr a touch higher above 0.715%. Swap rates are marginally lower, the 10yr near 0.82%. This is fresh lows back to mid Jan.
• The general tone from BoJ officials, including Governor Ueda, since last week's exit from NIRP has been cautious around the pace of follow up tightenings and strongly emphasized the likelihood of continued easy monetary conditions. This backdrop has no doubt helped keep a cap on upside yield momentum.
• Still to come, the BoJ's Uchida will appear before parliament later and we have the 2yr debt sale as well.