Heading in to the close JGBs have.......>

JGB SUMMARY: Heading in to the close JGBs have edged higher, although the moves

seen in the space have lagged those seen in other fixed income markets. 10 -Year

JGB futures last trade 7 ticks higher at 150.63, with the benchmark 10-Year

yield 0.5bp softer at 0.066%. 

- Today's 5-Year auction was well digested, with yields hovering around the

level that was well received in the prior auction, although the cover was softer

this time out. As a result, the sector's modest underperformance that was seen

heading in to supply was unwound, with the curve operating in a relatively flat

manner. Soft Q417 Japanese GDP data (although relatively in-keeping with the

broader picture of slowing growth vs. Q3) also supported the space, with

optimism surrounding the re-appointment of BoJ governor Haruhiko Kuroda for a

second term, alongside a stronger JPY and soft domestic equity market providing

additional impulses for JGB buyers. 

- Looking ahead the BoJ will conduct Rinban operations in the 1-3 Year, 3-5 Year

and 5-10 Year sectors of the curve on Thursday, with US CPI set to shape market

sentiment in the upcoming session.