JGB futures have softened a touch, with the....>

JGBS: JGB futures have softened a touch, with the belly & longer end of the cash

curve experiencing some modest underperformance in early dealing as yields tick

slightly higher, as do local stocks.

- 5-Year supply dominates the local docket today, with short covering

requirements & yesterday's 2-Year redemptions offering support. 5-Year paper

looks cheap vs. the nearby 3-Year sector in outright yield spread terms,

although the z-spread method is a little less compelling, but still provides a

slightly favourable valuation vs. 7s, the same holds true for ASW terms.

- The auction represents the opening of #JB137, which will hold a 0.1% coupon.