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JGB futures were roiled in Friday's............>

JGBS: JGB futures were roiled in Friday's overnight session, as a RTRS sources
report suggested that "the BOJ is in unusually active discussions before this
July's MonPol decision, with changes to its interest-rate targets & stock-buying
techniques on the table. Discussion is preliminary & will depend on fresh
inflation forecasts. While a policy change this month could theoretically
include additional easing, debate for now focuses on ways to make the massive
stimulus programme more sustainable. The BOJ could tweak its YCC programme to
allow for a more natural rise in long-term interest rates to ease the pain on
banks from years of near-zero rates, they say. Other ideas include operational
changes to the way the BOJ buys gov't bonds & ETFs, a nod to critics who say the
bank's huge purchases are drying up market liquidity & distorting price action."
- BOJ Gov Kuroda downplayed the sources report at the weekend, stating "I know
absolutely nothing about the basis for those reports."
- Focus today will fall on the cash space's reaction to the story after JGB
futures closed 48 ticks lower & the BOJ's Rinban ops covering the 1-5 Year
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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