JGB's head into the close slightly lower in....>

JGBS: JGB's head into the close slightly lower in a quiet session ahead of the

BoJ announcement on Thursday. Futures last down 2 ticks at 150.96 moving in a 6

tick range through the Tokyo session. JGB's initially opened higher as the

Nikkei 225 got off to a sluggish start, resisting broad gains in equity indices

in the region and a positive lead from the US.

- After touching 151.00 futures dropped, JGB players joining the sell off in

global bonds on optimism around the US tax bill. In the afternoon session the

MOF sold 15.5-39 year JGB's in an enhanced liquidity auction, the auction

results were soft despite expectations for strong bids due to limited supply and

heavy weighting of BoJ purchases in the second half of the month.

- Yields mixed across the curve, some steepening seen as the long end sees

buying ahead of BoJ purchase operations tomorrow. 10-Year yield bucks the trend,

up 0.2bp at 0.44%.

- The Cabinet Office released their economic forecasts for fiscal year 2018,

downgrading CPI estimates from those in their budgets, but did raise real GDP to

1.8% from 1.4%.