PREVIEW: The Japanese MOF will today...>

JGBS AUCTION: PREVIEW: The Japanese MOF will today sell Y900bn of 20-Year JGB's

opening #JB168. The MOF last sold 20-Year debt on March 19, the auction drew

cover of 4.837x at an average yield of 0.391%, average price of 101.99, high

yield of 0.393%, low price of 101.95, with 14.9462% of bids allotted at the high

yield. 20-Year JGB yields have operated in a ~7bp range in the time since the

most recent auction, last ~2.5bp off of the top of the range at 0.371%. This

comes after dovish global central banks & end of FY demand drove super-long JGB

yields lower in March.

- Attractive carry & roll & the fact that this is the 1st round of 20-Year

supply in the new FY (representing a new line) should support demand, and offset

any worry re: demand ahead of the elongated Golden Week holidays. In fact, the

longer than usual holiday period may provide support to this round of supply,

with no benchmark super-long supply scheduled until 14 May.

- On the curve, the 10-20 Year spread is hovering just above the recent cycle

low, while the 20-30 Year spread trades ~3.0bp off of the recent low.

- Results due at 0435BST/1235JST