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Long End Sags

JGBS

JGB futures softened during the Tokyo morning, going out -3 vs. previous settlement levels, unwinding the modest bid seen at the post-holiday re-open. Cash trade saw some underperformance for the super-long end, resulting in bear steepening, with a similar move seen in swaps (although super-long swap spreads tightened marginally).

  • Japanese Finance Minister Aso provided plenty of headline fodder, although none of it was new. Aso once again pointed to the COVID-driven deterioration in Japan's fiscal situation, while deploying some well-trodden rhetoric re: JGBs.
  • A liquidity enhancement auction for off-the-run 5-15.5 Year JGBs headlines locally this afternoon.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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