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DMO Plans Lower 2021-22 Issuance Than Expected


New Yield Curve Lows


(F1) Bear Trend Conditions Intact

JGBS: JGB futures ripped higher as they played catch up after a long Tokyo
weekend, gaining fresh upside impetus in the second half of the session. The
contract finished +58 ticks on the day at 153.48, with the afternoon move likely
aided by the moderation in offer to cover ratios in today's 10-25+ Year Rinban,
outlined earlier. Bulls now look to 153.55, the Nov 28 high and key resistance.
- The belly was the outperformer in the cash space on the day, while swap spread
tightening was highlighted again in the super-long end, even as super-long paper
lagged the belly (morning underperformance may have been linked to some
pre-Rinban nerves).
- Also worth flagging the most recent comments from Japanese PM Abe, who noted
that the government is putting together a policy re: coronavirus measures, and
noted that the country will take stronger steps to fight the virus in regions
that have witnessed cluster infections.
- Coronavirus developments continue to snatch attention, with a 15.5-39 Year JGB
liquidity enhancement auction scheduled for tomorrow.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |