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JGBS AUCTION: 5-Year Supply Shows Solid Demand Metrics

JGBS AUCTION

Today's supply of 5-year bonds showed solid demand metrics. The auction's low price met dealer expectations, which had been projected at 99.88 as per the BBG poll, and the cover ratio increased to 3.7588x from 3.5109x at August’s auction. The auction tail was also shorter.

  • As noted in our preview, today’s auction came on the heels of a solid 10-year outing in September.
  • The results were likely affected by a bid that faced a yield 5-10bps higher than August’s offering. However, the 2/5 curve was near the lower end of its range since December 2022.
  • The 5-year JGB is slightly lower after the auction. JGB futures are little changed in early afternoon dealings.

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