JGB's head into the close higher,.......>

JGB SUMMARY: JGB's head into the close higher, after a drop at the start of

Tokyo trade the future bottomed out at 150.66 - sources noting selling picking

up on the break of 150.69 the Aug 21 low that had held the previous two days. 

- The BOJ conducted buying ops in 1-3, 3-5, 10-25 & 25+ year zones, all sizes

unchanged. The lack of change amid mild speculation that the short end size

could be cut saw some strength in the afternoon. The move higher coincided with

comments from Trump that the US would probably exit NAFTA soon and that he would

shut down the goverment to build the border wall which spurred safe haven demand

globally. The purchase operations were weak with cover dropping in all

maturities and wider spreads, likely reflective of tight supply/demand

conditions and could have spurred the bid for JGB's in the afternoon.

- The Nikkei manufacturing PMI at the August prelim reading rose to 52.8,

hitting a 3-month high in the process, but this failed to move markets.

- Yields lower across the curve heading in to the close, moves subdued after a

round trip in the session, moves mixed with 10-Year yield last down 0.1bp at

0.039% even ahead of the liquidity auction tomorrow.