JGB futures edged away from session highs during the second half of the Tokyo morning, hitting the lunch break +7 vs. Tokyo settlement levels, while the major cash JGB benchmarks run 0.5-2.5bp richer across the curve, bull flattening. There hasn’t been much in the way of decisive news flow to digest leaving cross-market gyrations at the fore.
- Note the previously outlined BBG interview with “Mr. JGB,” who warned that “investors should start preparing for a return to normal Japanese bond trading as the central bank will one day step back from its debt purchases.” This hasn’t had much in the way of market impact, although the article has generated plenty of interest.
- 10-Year breakevens have edged away from the narrowest levels observed since early April, with this afternoon’s 10-Year JGBi supply in focus.