Futures Through Overnight Highs, Within Striking Distance of Mar 22 High

In afternoon Tokyo trade, JGB futures have surged past the overnight high and are now at +21 versus settlement levels. JBM3 has reached 149.08, its highest level since March 27 and is close to the March 22 high of 149.53. According to MNI's technical analysis, exceeding the March 22 high would signal the continuation of the upward trend.

• There haven't been any significant domestic drivers to impact the market, with previously mentioned money supply data having minimal impact. As a result, the local market has followed the lead of US tsys, which have continued their richening trend from Thursday in Asia-Pac trade.
• Cash JGBs are experiencing gains across the curve, except for the 1-year zone which is 0.4bp cheaper on the day. The yield curve has flattened with yields ranging between 0.7 to 3.1bp lower. The benchmark 10-year yield has dropped by 1.9bp to 0.379%, which is well below the BoJ's YCC limit of 0.50%. Meanwhile, the benchmark 30-year yield is down by another 2.6bp to 1.207%, following a 5bp decline yesterday, which came after a strong auction result.
• Swap rates are lower across the curve with swap spreads wider except for the 1-year zone.
• The local calendar is relatively heavy next week with PPI data on Monday and Q1 GDP (preliminary) on Wednesday as the highlights.
• 5- and 20-year JGB supply is scheduled for Monday and Wednesday, respectively, along with BoJ Rinban operations covering 1-10-year and 25-Year+ JGBs.