JGB's took a brief dip lower at the open.......>

JGBS: JGB's took a brief dip lower at the open after strong GDP data, headline

Q2 preliminary GDP rose 1.0% against estimates of 0.6% from a final 0.4% in Q1,

the annualised figure rose 4.0% while private consumption and business spending

both rose strongly. In the wake of the data LDP's Motegi said that the economy

was recovering moderately and there was no need for additional fiscal stimulus

now.

- An important point is that the GDP deflator is starting to rise slightly, the

latest print rising to -0.4% from -0.8%. While still denoting weakness in the

inflationary environment this is a move in the right direction and will provide

some encouragement to the BoJ in their attempts to stoke inflation.

- Following the print JGB futures dropped to session lows at 150.45 before

bouncing back to opening levels at 150.50, last trades at 150.49. Volume is thin

as news regarding the US/North Korea situtation takes a temporary hiatus.