JGB yields edged higher in early dealing on....>

JGBS: JGB yields edged higher in early dealing on Monday, with the belly

underperforming, as 10-Year yields finished the morning session at 0.11% (a key

threshold for the BOJ's YCC in recent days). The BOJ stepped in during the

afternoon session, offering to buy an unlimited amount of JGBs at 0.10%, this

was the third such offering in a week, with the rate matching that seen in

Friday's operation. The Bank received Y1.64tn worth of offers, up from the Y94bn

received on Friday. The question remains, is the BOJ trying to lull the market

into a false sense of security re: today's MonPol decision, or is it showing

that it doesn't intend to budge from its current MonPol settings? Benchmark

10-Year JGBs closed at 0.102%, although the long end underperformed. Futures

softened after a brief blip higher on the announcement of the fixed rate

operation, convincingly breaching Friday's low of 150.45 in the overnight

session, and hovered around last Monday's session low at the close.

- Focus is on today's BOJ MonPol decision following the smattering of source

reports observed over the last 2 weeks, with participants also set to pay

attention to the Bank's August Rinban operation plan, due later in the day.