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PREVIEW: Liquidity Enhancement Auction For OTR 5- To 15.5-Year JGBs Due

JGBS AUCTION

The Japanese Ministry of Finance (MOF) will today sell Y500bn of JGBs with 5-15.5 Years until maturity in a liquidity enhancement auction. JB#1-28, #100-165 & #350-368 will be on offer.

  • The previous liquidity enhancement auction covering these maturities was held on 13 December. The auction was covered 5.495x at an average spread of -0.003%, a high spread of -0.001% was registered, with 43.1263% of the bids allotted at the high spread.
  • Pre-BoJ decision demand linked to short covering should result in smooth digestion of today’s supply, with a notable jump in short positioning on further YCC speculation and demand for access to JGBs evident, as we have flagged earlier (with the latter a problem that is worsened by the increase in BoJ purchases).
  • Results due at 0335GMT/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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