PREVIEW: The Japanese MOF will today...>

JGBS AUCTION: PREVIEW: The Japanese MOF will today sell Y2.0tn of 2-Year JGB's

opening JB#403. The MOF last sold 2-Year debt on June 27, the auction drew cover

of 4.394x at an average yield of -0.216%, average price of 100.636, high yield

of -0.211% , low price of 100.625, with 63.7779% of bids allotted at the high

yield.

- Outright 2-Year yields last trade ~5bp back from their cycle low that was

registered in late June, printing at -0.199% at writing.

- The 2-/5-Year spread continues to look flat, but a lack of inflationary

pressure and continued Rinban purchases from the BoJ will continue to promote

flatness.

- The benchmark 2-Year's z-spread sits near the peak of its short life.

- Results due at 0435BST/1235JST