Low Conviction Start To The Week

BOND SUMMARY: Tsys held a tight range in Asia-Pac hours, with T-Notes last -0-01 at 139-18, holding to a 0-03 range, with yields sitting unchanged to 0.6bp cheaper across the curve and little conviction noted. The space ultimately looked through the latest round of TikTok and COVID-19 vaccine headlines in early dealing this week.

• JGB futures lacked any real impetus through Friday's overnight highs and didn't manage to pierce last week's peak, last +2 vs. Tokyo settlement levels. Yields were marginally mixed across the curve, with little in the way of fresh news flow to add to the earlier points. Receiving of super-long swaps seemingly supported the long end, resulting in some light twist flattening of the curve. 10-25 Year BoJ Rinban ops saw the purchase size unchanged and internals virtually unchanged vs. the previous round of ops.
• Aussie bonds also held to a tight range, with emphasis falling on activity in the rolls, as participants suggested selling of the rolls i.e. rolling longs, provided support to the Z0 leg early on in Sydney trade, as the major futures pressed through their SYCOM highs. YMZ0 last +1.6, with XM +3.4. On the news front, participants continue to look to Sino-Aussie tensions, although the developments have had no real meaningful impact on prices.