Limited, With Chinese Matters Capping

Core fixed income was generally contained during Asia-Pac hours, with a relatively sizable liquidity injection from the PBoC, solid Chinese economic data and a firmer Chinese yuan the major takeaways in the macro arena, effectively capping the space during overnight trade.

• T-Notes held a tight range around the late lows registered on Monday, last printing unchanged at 139-18, with yields running unchanged to 0.5bp richer across the cash curve. Focus now reverts to domestic matters, with 20-Year Tsy supply, empire state manufacturing and industrial production data all due.
• JGB futures held a tight range, just shy of the psychological 152.00 mark, last dealing unchanged, with 10s outperforming in cash trade, while the shorter end of the JGB curve underperformed. Little to note outside of a well-received liquidity enhancement auction for off the run 5-15.5 Year JGBs. Elsewhere, Japan authorised a further ~Y1.6tn worth of spending to help fight COVID, although the cash will come from reserves, not fresh issuance.
• Over in Australia, the RBA's September meeting minutes revealed a lack of fresh detail surrounding the potential for further easing, perhaps disappointing participants in the wake of recent press reports and the change of wording in the RBA's guidance passage in its September statement. YM and XM virtually unchanged at typing.