JGB futures last trade 12 ticks softer at......>

JGBS: JGB futures last trade 12 ticks softer at 150.55, after a brief foray

higher in early dealing was met by sellers, with additional selling apparent in

the afternoon session. Futures eased following reports from Kyodo re: comments

from a ruling LDP party off'l, who suggested that dissolving the lower house is

one option available to the party in light of the recent political scandal &

fall in PM Abe's approval rating. This would bring the longevity of Abenomics

into question. The initial sell off also coincided with US Tsys moving lower, as

the US 10-Year yield breached 3.00%.

- The BoJ left the size of its Rinban operations covering the 5-25+ Year buckets

unchanged in today's round of operations. Looking at the breakdown, the 5-10

Year bucket's offer to cover ratio was largely stable as the yield spread

moderated. The 10-25 Year bucket's offer to cover ratio eased, as the yield

spread moderated. The 10-25 Year bucket's offer to cover ratio edged up as the

yield spread moved into negative territory.

- There was little in the way of headlines during the afternoon session.

- The belly of the cash space has underperformed.