JGB & ACGB Yield Curves Bear Steepen As Region Digests Thursday Tsys Impetus

T-Notes pushed higher overnight, albeit somewhat more reluctantly than in yesterday's Asia session, moving away from Thursday's lows printed after an underwhelming 30-Year Tsy auction. The contract last trades +0-02 at 139-01. Little to drive the move in the way of headline flow, as in the absence of fresh catalysts the main focus remained on U.S. fiscal stalemate and global coronavirus situation. China's data dump painted a (on balance) slightly worse picture than expected, but core FI space was unimpressed, with T-Notes continuing to slowly move uphill. Cash curve underwent some bull flattening, with yields sitting 0.2-1.5bp lower as we type. Eurodollar futures last seen unch. to +0.5 tick through the reds. U.S. docket today features domestic retail sales, industrial output, preliminary U. of Mich. Survey and a Q&A with Fed's Kaplan.

• JGB futures meandered, looking for a clear direction; the contract last deals at 151.68, -19 ticks vs. settlement. Cash JGB yields sit higher, save for 2s, with curve running a touch steeper. It was a quiet end to the week in Japan, a 5-15.5 Year enhanced liquidity auction came and went.
• Aussie bond futures stuck to tight ranges; YM -0.5 & XM -4.0 at typing. Bear steepening crept into cash ACGB space, but purely as a function of Thursday's moves in Tsys. ACGB yields last seen 0.4-4.0bp higher across the curve. Bills running unch. to -2 ticks through the reds. The space showed little to no reaction to a parliamentary testimony from RBA Governor Lowe and ACGB 2.75% 21 Nov '28 supply. The AOFM announced that it will auction ACGB 2.75% 21 Jun '35, ACGB 1.00% 21 Dec '30 & ACGB 0.25% 21 Nov '24 next week.