Off Lows

JGB futures unwound their overnight losses as we moved through the Tokyo morning, with JGBH2 hitting the bell +2, aided by a downtick in domestic equities, some worry re: Chinese equities and continued uncertainty when it comes to the war in Ukraine. Cash JGB trade was a little more mixed, with broader yields moving back from their early Tokyo highs (which were a function of tracking the broader impetus in core global FI markets since the Tokyo close), although steepening remained evident, with super-long JGBs failing to make a notable move away from cheaps. That left paper out to 20s between -/+0.5bp on the day, while 30+-Year paper sits 1.0-1.5bp cheaper on the session.

• There hasn’t been much in the way of notable domestic headline flow.
• The head of the BoJ’s monetary policy department noted that "unless there's risk of second-round effects, such as (an excessive) rise in wages, it's inappropriate to respond with monetary tightening," in an appearance in front of parliament.
• Elsewhere, Japanese Finance Minister Suzuki flagged that the government isn’t looking at deploying an economic fiscal package at present, while it is keeping an eye on the impact of the price of oil re: households & firms.