JGB futures recovered from their Rinban........>

JGBS: JGB futures recovered from their Rinban tweak inspired lows, last +1 tick

on the day. The slight reduction in longer dated offer to cover ratios, coupled

with the MoF buying back Y20bn worth of JGBs & a slight pullback in the Nikkei

has likely cushioned the earlier fall in futures, although there has been no

respite for 20+ Year paper on the back of the Rinban tweaks, with the super-long

end underperforming in cash trade. Offer to cover ratios for the Rinban

operations were as follows: 1-3 Year 3.08x (prev. 2.71x), 3-5 Year 2.49x (prev.

1.88x), 10-25 Year 2.43x (prev. 2.68x), 25+ Year 3.45x (prev. 4.32x)

- FinMin Aso said that further discussions on FX will occur between himself &

U.S. Tsy Sec Mnuchin. Aso also noted that he doesn't expect the ongoing trade

talks to effect BoJ MonPol, and that there is no change in the gov't stance on

implementing the sales tax hike, after Thursday's comments from a policymaker.

- We also heard that MOF, FSA & BoJ off'ls will meet later, likely on matters

pertaining to the elongated Golden Week Holiday. Elsewhere, the latest BBG

sources report suggested that the BoJ will likely trim its GDP exp. next week,

while the sources were less clear if the Bank would lower its CPI forecasts.