Mixed, Narrow Trade For Core FI In Asia

Cash Tsys sit unchanged to 0.8bp cheaper across the curve, with modest bear steepening seen. T-Notes are still hugging a tight 0-03 range, last +0-02 at 137-15+. A 10K lift of the low delta TYH1 139.50 calls provided the highlight on the flow side during Asia-Pac hours. A deepening of COVID-19 restrictions in Los Angeles has seen a very modest downtick in e-minis in recent trade.

• The Tokyo morning saw JGB futures unwind their overnight losses, before a downtick in the cover ratio at the latest round of 30-Year JGB supply seemed to apply some light pressure during early afternoon trade. That contract last sits -3 vs. settlement, although cash JGBS sit unchanged to a touch richer on the day. BoJ board member Suzuki largely went over old ground and flagged the desire for a gradual steepening of the JGB yield curve. Local data provided little to go off for the space.
• Over in Australia we saw the RBA step in to enforce its 3-Year yield target, which added some support to the Aussie bond space, allowing YM and XM to print at unchanged levels at one point. The contracts last print -0.5 and -1.0 respectively. Local data saw a mix of firmer than expected exports and softer than expected imports provide a much wider than expected trade surplus for the month of October, while the latest round of housing finance data came in on the softer side of exp.