PREVIEW: The Japanese MOF will today...>

JGBS AUCTION: PREVIEW: The Japanese MOF will today sell Y700bn of 30-Year JGB's

opening JB#65. The MOF last sold 30-Year debt on December 5, the auction drew

cover of 3.689x at an average yield of 0.430%, average price of 99.20, high

yield of 0.432%, low price of 99.15, with 88.7986% of bids allotted at the high

yield. Geopolitical matters have been the dominating factor for JGBs in the

early part of 2020, with 30-Year yields last at 0.436%, around the middle of the

range operated in since the previous auction.

- The 20-/30-/4-Year fly sits around the middle of its recent range, and it

seems that 30s look about fair on the curve in relative terms at present.

- The 30-Year ASW spread has recovered from recent lows, and trade back around

the levels seen at December's 30-Year auction.

- There doesn't appear to be much of a short covering need among dealers, but

the issuance of a fresh line could generate demand. Although it is worth noting

that worry re: the potential for further BoJ Rinban tapering may weigh on

dealers' minds.

- Results due at 0335GMT/1235JST.