JGB's went into the close lower, futures.......>

JGBS: JGB's went into the close lower, futures last down 3 ticks at 150.88.

JGB's opened higher receiving a boost from higher UST's after CPI figures and a

dovish FOMC hike. Some profit taking was seen early on and in the mid part of

the morning session futures hit lows of 150.92 before bouncing into the

afternoon. The MOF sold 20-Year bonds, the auction stopped out at 0.573%, the

same as the previous auction, cover rose slightly to 4.56 - the highest in

almost 4 years. Auctions in the long end have been strong recently, supported by

wider USD/JPY basis swaps coupled with Y16.7tln of redemptions in December. 

- Yields mixed across the curve seeing some twist flattening, the strong auction

seeing a sell off in the short end but spurring a bid in the long end, 10-Year

yield up 0.3bp at 0.053%, 2-/20-Year spread 0.6bp narrower.

- Swaps outperformed yields in the long end, 30-Year swap cheapening 0.5bp to

L-2.6bp, the long end sector still attractive on a Z-Spread basis.

- Today was the first trading day in the new March (JBH8) contract.