Last Dove Standing

JGB futures rebounded in the final overnight trading session of last week, with BoJ Governor Kuroda continuing to affirm the Bank’s status as the last dove standing in the major central banking sphere, after the Bank left its monetary policy settings unchanged on Friday. The Bank also noted that it intends to conduct consecutive daily unlimited bond buying of CtD 10-Year JGBs (JB#356) for an extended period, while partially relaxing conditions surrounding the Securities Lending Facility for JB#356-358 “in order to ensure stability in the market by easing excessive tightening in supply and demand of Japanese government securities in the repo market.” This allowed the contract to add 84 ticks in post-Tokyo trade, going out at best levels of the session.

• Weekend commentary has seen both of the political parties that form Japan’s ruling coalition support the BoJ’s monetary policy settings, although the latest Nikkei survey revealed that 46% of the public would prefer a move away from the current ultra-loose monetary settings, while 36% of those surveyed favour the Bank’s current approach.
• Elsewhere, PM Kishida’s cabinet has seen a downtick in support in the latest round of opinion polls.
• Note that the broader local docket is empty on Monday.