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JGBs have operated in an orderly fashion,......>

JGBS
JGBS: JGBs have operated in an orderly fashion, following the extended holiday
weekend. Futures trade 3 ticks higher at 150.86, while 40-Year paper
underperformed in cash dealing as the curve steepened.
- Swaps were wider out to 10-Years.
- The BoJ left the size of its Rinban operations covering the 1-5 Year & 10-25+
Year buckets unchanged (although there was some chatter re: the potential for
trimming the size in the early part of the session).
- The 1-3 Year bucket's offer to cover ratio moderated, with the spread
returning to neutral levels. The 3-5 Year bucket's offer to cover ratio ticked
higher, but the spread moved into negative territory. Looking to the longer
dated operations, the 10-25 Year offer to cover ratio ticked higher, while the
offer to cover ratio of the 25+ Year bucket moved higher (from a little under 3
to over 4). All in all, it seems that the operations passed smoothly.
- Bulls take comfort in the closes above the 55-DMA (150.85) & continue to look
for a close above the April 12 low (150.95). Bears look for a close below 150.70
to shift focus lower.
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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