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PREVIEW: 5-Year JGB Supply Due

JGBS AUCTION

The Japanese MOF will today sell Y2.59tn of 5-Year JGBs opening JB#151. The MOF last sold 5-Year debt on March 8, the auction drew cover of 3.292x at an average yield of -0.007%, average price of 100.06, high yield of -0.003%, low price of 100.04, with 57.3359% of bids allotted at the high yield.

  • Most seem to expect the (marginal) positive yield on offer to provide support when it comes to takedown at today’s auction.
  • In relative terms, we see less in the way of compelling value, with the likes of the 2-/5-/10-Year butterfly operating around the middle of the YtD range.
  • Overall, we would expect demand to be solid, if not spectacular, with the impact of ongoing market vol. at least partially offset by the BoJ’s cap on 10-Year JGB yields.
  • Results due at 0435BST/1235JST.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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