JGBs have edged lower this morning, with.......>

JGBS: JGBs have edged lower this morning, with market perhaps paying attention

to the RTRS source piece released after the close on Monday which noted that

that interviews with a dozen people familiar with the BOJ's thinking reveal for

"the first time that there were plans to raise rates twice this year. In

January, market turbulence pulled the rug from under an announcement of an

increase. The bank then hoped to signal higher rates in July and raise them in

September, but weak inflation data scuttled that idea too." "The latest steps

marked a major turning point for Kuroda's stimulus program," a source said. "The

reflationists have become a minority, which means the BOJ is turning more

hawkish." One of the sources also notes that "it's unclear what the BOJ really

wants to do. It's doubtful how much the latest moves would help banks. The only

thing clear is that with a dearth of policy tools, the BOJ is in a deadlock." 

- The belly to longer end of the curve has underperformed, with modest

steepening apparent. 10-Year JGBs have gone into the break a touch softer, but

haven't breached Monday's low as of yet. Focus remains on the release of the

summary of opinions from the BOJ's July MonPol decision, due tomorrow.