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JGBS: Subdued Session Ahead Of US Presidential Election

JGBS
GlobalBulletAPACFixed Income BulletsJapanRegionMarkets

In Tokyo morning trade, JGB futures are flat compared to settlement levels on Friday. The local market was closed yesterday for a holiday. 

  • The local calendar has been light today with monetary base as the sole release.
  • Cash US tsys are 1-2bps cheaper in today’s Asia-Pac session, with a flattening bias. Yesterday, the so-called “Trump trade” (bear steepener) was unwound after a poll in Iowa, a typically reliable red state, gave Harris a 3-point lead over Trump. A late swing to Harris was also evident in other weekend polls. However, Polymarket still shows odds that favour Trump to win in today’s US Presidential Election. Political polling in key swing states remains within the margin of error, leaving the race finely balanced.
  • Cash JGB swings are +/- 1bp across benchmarks beyond the 1-year. The benchmark 10-year yield is 0.5bp lower at 0.946% versus the cycle high of 1.108%.
  • Swap rates are flat to 1bp lower. Swap spreads are tighter.
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In Tokyo morning trade, JGB futures are flat compared to settlement levels on Friday. The local market was closed yesterday for a holiday. 

  • The local calendar has been light today with monetary base as the sole release.
  • Cash US tsys are 1-2bps cheaper in today’s Asia-Pac session, with a flattening bias. Yesterday, the so-called “Trump trade” (bear steepener) was unwound after a poll in Iowa, a typically reliable red state, gave Harris a 3-point lead over Trump. A late swing to Harris was also evident in other weekend polls. However, Polymarket still shows odds that favour Trump to win in today’s US Presidential Election. Political polling in key swing states remains within the margin of error, leaving the race finely balanced.
  • Cash JGB swings are +/- 1bp across benchmarks beyond the 1-year. The benchmark 10-year yield is 0.5bp lower at 0.946% versus the cycle high of 1.108%.
  • Swap rates are flat to 1bp lower. Swap spreads are tighter.