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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.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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