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

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.