PREVIEW: The Japanese MOF will today...>

JGBS AUCTION: PREVIEW: The Japanese MOF will today sell Y1.9tn of 5-Year JGB's

re-opening JB#143. The MOF last sold 5-Year debt on May 18, the auction drew

cover of 4.492x at an average yield of -0.122%, average price of 101.08, high

yield of -0.119%, low price of 101.07, with 49.2132% of bids allotted at the

high yield.

- Outright yields hover around the middle of the range witnessed since the end

of March, last ~-0.11%. Asset swaps and the 2-/5-/7-Year JGB fly remain a little

elevated against pre-March vol levels, but are well shy of the respective peaks

witnessed in the midst of the March madness. 5-Year swap spreads are a touch shy

of pre-March vol levels, but once again, well back from the March tights.

- The BoJ's turn towards more active Rinban management should lend support to

the auction, although this will have to be assessed against the jump in supply

given fiscal spending requirements in the wake of COVID-19

- Results due at 0435BST/1235JST