Futures Unchanged Overnight, US Tsys Cheapen As They Await US CPI & FOMC Minutes

In post-Tokyo trade, JGB futures are unchanged compared to settlement levels, despite an extension of last week’s sell-off in US tsys. Trading was, however, subdued ahead of Wednesday's CPI report and the FOMC minutes. US PPI on Thursday.

• While market movements were well contained, the US tsy 10-year yield rose to the highest since November (4.46%), before finishing 2bps higher at 4.42%. The US 2-year note finished 4bps higher at 4.79%.
• Fed Funds expectations indicate that the June meeting is almost evenly split between the likelihood of a rate cut and maintaining current rates. The first cut isn't fully priced until August, with just 63bps of cuts currently priced in for the entire year. Essentially, the market is divided between predicting either two or three rate cuts in total.
• (Bloomberg) -- Governor Kazuo Ueda marks his first anniversary at the helm of the Bank of Japan having dismantled one of the most ambitious stimulus experiments in central bank history with an approach that surprised analysts both for its speed and its success avoiding market ructions. (See link)
• Today, the local calendar will see the Consumer Confidence Index and Machine Tool Orders data alongside 5-year supply.