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JGB's experienced a lacklustre morning.........>

JGBS
JGBS: JGB's experienced a lacklustre morning session with futures sticking to a
tight range, as the cash curve operated in marginally mixed territory. The BOJ's
Rinban ops took centre stage. The ops covered the 1-5 & 10-25+ Year buckets &
represented the first ops conducted this month. As a reminder the BOJ trimmed
the number of purchases of the 1-10 Year buckets in its September Rinban ops to
5 (prev. 6), although in all the buckets where the Bank trimmed the number of
monthly purchases, it also upped the potential size of the purchases (by rising
the upper limit of the permitted purchase size band by Y100bn). Some suggested
that the move was a result of calendar effects i.e. a limited amount of eligible
purchase days during the month of Sep, which rang true as the Bank upped the
size of its ops covering the 1-3 & 3-5 Year buckets by 50bn a piece, when
compared to the most recent ops covering the same maturities. The offer to cover
ratios of the ops can be seen below:
- 1-3 Year: 2.91 (prev. 3.29), 3-5 Year: 2.85 (prev. 3.41), 10-25 Year: 3.31
(prev. 3.47), 25+ Year: 4.08 (prev. 3.69).
- There was no notable reaction in JGBs to the latest Rinban tweaks.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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