JGB's head into the close flat/slightly........>

JGBS: JGB's head into the close flat/slightly higher. After opening Tokyo higher

JGB futures rose to session highs of 150.79, getting a boost from higher UST's.

This move was shortlived and in thin trade JGB futures gave up a few ticks to

head into the lunch break around 150.74, lower on the session but up 5 ticks on

the day. The market had largely ignored data early in the session, Industrial

Production and Retail Sales both rose above forecasts. Retail Sales in

particular were strong, the solid gains showed consumption is firming and is

positive for the economic outlook of Japan. 

- The BoJ conducted their final purchase of JGB's of this calendar year, the

Bank purchased 5+ Year JGB's, 5-10 Year results were broadly in line on tight

supply demand conditions, but the 10-25 and 25+ Year results were slightly

weaker with higher offer/cover in both sectors on some fears that the BoJ could

reduce long end purchases when they announce the January plan after market

today. Yields mixed across the curve, mostly lower with some mild bull

flattening seen. 10-Year yield down 0.2bp at 0.054%.