JGB futures have turned bid in the early.......>

JGBS: JGB futures have turned bid in the early part of the afternoon session, in

sympathy with Tsys. The contract has stuck to a tight range, and operates just

off of best levels last.

- Looking at the cash space, the curve sits a little steeper with yields edging

higher in the super-long end, while shorter dated yields have ticked lower.

- BoJ's Funo offered little new in an address made today, stating that that the

board's decision of allowing the 10-year interest rate to move widely in July

doesn't mean that the BOJ will raise interest rates. In a speech to business

leaders in Kochi City, southern Japan, Funo said that "if (the BOJ) maintained

the powerful easy policy, it would affect business conditions at financial

institutions through a drop of margin from loans, which in turn will create the

risk of a pullback in financial intermediation. We continue to pay attention to

the risks considered most relevant to the conduct of monetary policy," Funo

continued while indicating that the BOJ doesn't need to adjust policy to

mitigate the side effects of a prolonged easy policy."