Futures were happy to hold lower during the....>

JGBS: Futures were happy to hold lower during the Tokyo morning, going into the

lunch break 15 ticks below settlement levels, with most major equity indices

ticking higher and focus on the potential for even deeper domestic fiscal

spending on the back of a Nikkei source report and comments from PM Abe.

- The belly of the curve underperformed, with swaps generally tighter across the

curve.

- The summary of opinions from the most recent BoJ MonPol decision did little to

jolt markets.

- BoJ Rinban ops saw the Bank up its 3-5 Year purchase size by another Y50bn,

after it trimmed the number of ops for that particular bucket scheduled for the

month of May to 5. The upping in purchase size over the 2 most recent ops

covering the bucket will more than offset the reduction of operations on a

cumulative M/M basis. Purchase sizes elsewhere were left unchanged.

- The offer to cover ratio for 3-5 Year ops edged higher, while the same metric

for the 25+ Year bucket jumped over 4. Spreads widened for both these buckets.

Conversely 1-3 Year ops saw a steady cover ratio and narrower spreads.