Off Worst Levels At Lunch

Paper out to 10s nudged away from session cheaps as the morning session wore on, aided by a similar move in U.S. Tsys. That leaves 7s as the only major point on the JGB curve that is running cheaper on the day (by 0.5bp), while the remainder of the major benchmarks are ~1bp richer.

• Futures hit the bell +3 after briefly and modestly showing below their overnight base during the early Tokyo round of weakness.
• Local headline flow has pointed to a need to address childcare and cost issues from senior Ministers, after households suggested that initial regular payment proposals circulated in recent days are shy of the required mark.
• Note that the recently revealed offer/cover ratios observed in the scheduled 1- to 5- & 10- to 25-Year BoJ Rinban operations were modest, printing at 1.4-2.4x, although the unscheduled round of 5- to 10-Year JGB purchases was elevated, printing above 5.00x, suggesting that there is a continued desire to test the BoJ’s will when it comes to its YCC settings.