Off Session Cheaps At Lunch Break

Little to really add to our earlier comments when it comes to JGBs, with the space consolidating just off session cheaps at the lunch break after futures pulled away from their early session highs alongside weakness in wider core global FI markets. That left JGB futures +3 at the lunch bell, while cash JGBs sit flat to 1.5bp richer across the curve.

• Participants will be digesting the details of the latest BoJ Rinban operations, with subdued offer/cover ratios seen in the details of the 1- to 3-, 5- to 10- & 25+-Year purchases (2.0-2.4x), while the 3- to 5-Year operations saw an uptick in offer/cover, to 3.1x, which isn’t particularly elevated, but is a little above what we have seen in recent weeks. This may generate some light selling pressure in that zone of the curve in early afternoon trade.