PREVIEW: The Japanese MOF will today...>

JGBS AUCTION: PREVIEW: The Japanese MOF will today sell Y3.0tn of 2-Year JGB's

opening JB#414. The MOF last sold 2-Year debt on May 28, the auction drew cover

of 5.277x at an average yield of -0.172%, average price of 100.546, high yield

of -0.169%, low price of 100.540, with 11.6467% of bids allotted at the high

yield.

- 2s currently yield ~-0.11%, a little cheaper in outright terms then the

prevailing yield at the prior 2-Year auction. This, coupled with the usual

introduction of a new line and the BoJ's active Rinban operations (with the aim

of steepening the curve), should support demand at the upcoming auction.

- The 2-/5-Year curve sits comfortably within the range witnessed since the

stabilisation of the space post-March vol.

- ASWs sit in the middle of the range witnessed seen since the previous auction.

- Results due at 0435BST/1235JST.