JGB traders returned from a long weekend,......>

JGBS: JGB traders returned from a long weekend, futures -15 last (albeit off

Friday's overnight lows) as the cash curve twist flattens and the belly

underperforms. The BoJ left the size of its 1-10 Year Rinban ops unch., with the

1-3 Year offer to cover ratio holding steady (3.65x vs. 3.49x), 3-5 Year cover

ratio ticking higher (3.14x vs. 2.43x) & 5-10 Year cover ratio softening (1.74x

vs. 3.28x). It was likely the uptick in the 3-5 Year offer to cover ratio,

coupled with the move into +ve territory for the spread of operations in that

bucket, that drove activity in the afternoon .

- Elsewhere, local data provided little interest, BoJ Governor Kuroda went over

old ground (effectively retaining optionality for this month's MonPol decision)

& Japan's government noted that it will consider drafting a supplementary budget

if the Y500bn it has in reserve for disaster relief is not enough re: Typhoon

Hagibis.

- The BoJ's regional report saw the bank upgrade its economic assessment of 1

region and hold the assessment of the remaining 8 steady.

- Tomorrow's local docket is bereft of any points of note.