JGB futures operated in familiar territory.....>

JGBS: JGB futures operated in familiar territory during the overnight session,

edging back from settlement levels after bull steepening was evident on Tuesday.

Some suggested the pullback in Tsys witnessed in Tokyo hours, coupled with the

bid in JGBs, may equate to money rotating out of Tsys and back into longer dated

JGBs, especially given the lacklustre 10-Year JGB auction results.

- Worth highlighting that MNI understands that the Bank of Japan will consider

reducing the frequency of its bond purchases in the benchmark 5-to-10-year

sector to three times monthly from the current four just as soon as market

conditions allow, although it will likely pare back purchases at the shorter-end

of the curve first.

- The local docket is limited today, with the only points of note being the

lower tier services & composite PMI readings.