Futures Weaker, No Data Today, BoJ Gov. Ueda On ECB Forum Panel Later

In post-Tokyo trade, JGBs are weaker, closing -6 compared to settlement levels, after US tsys finished dealing 3-8bps cheaper across the major benchmarks. The curve bear flattened. Earlier in the session tsys had firmed as the S&P500 opened firmer and a rally in Canadian bonds spilt over. Canadian core measures cooled slightly more than expected, with the median measure printing below 4% for the first time since February 2022.

• Early strength was short-lived as US tsys reacted to stronger-than-expected data (May durable goods orders, April home prices, May new home sales, and June consumer confidence).
• Market confidence of a hike at the July 26 FOMC has climbed to ~75% from 69% on Monday. November is more than fully pricing in a 25bp hike with a cumulative 28bp at 5.355%.
• Today’s Tokyo open comes after the sale of 20-year JGBs yesterday draws a lower-than-expected cut-off price, a wider tail and a lower cover ratio. Yield on 20-year debt advanced 1.5bp to 0.96% yesterday.
• There is no local data today. Later today however BOJ's Ueda is on a panel at the ECB Forum with Fed Chair Powell, ECB's Lagarde, and BOE's Bailey.