There isn’t much to add to the earlier commentary, with 7s & super long JGBs leading the way lower during Tokyo morning trade, as the major cash JGBs cheapened by ~0.5-2.0bp, with the weakness in 7s linked to futures, as the contract hit the lunch bell -21.
- Today’s BoJ Rinban operations yielded the following offer/cover ratios:
- 1- to 3-Year: 2.65x (prev. 3.31x)
- 3- to 5-Year: 2.32x (prev. 1.90x)
- 5- to 10-Year: 2.40x (prev. 2.48x)
- 10- to 25+-Year: 3.00x (prev. 4.59x)
- 10-Year JGB yields remain pinned at the upper limit of the BoJ’s permitted -/+0.25% trading band, despite this morning’s BoJ fixed rate operations, will the bank come back in with further fixed rate/Rinban operations later today?