Set For Cheapening

{JN} JGBS: Set For Cheapening

Japanese markets return from the elongated weekend and will have to assess the spill over impact of the aforementioned cheapening observed in U.S. Tsys on Monday, after JGB futures added 12 ticks in the final overnight trading session of last week.

• Elsewhere, the Sankei has reported that the Japanese government is eying additional fiscal stimulus of over Y10tn, which would be deployed ahead of the summer elections (with a focus on easing the burden of rising fuel costs and food prices), while Yomiuri noted that the ruling coalition is considering expanding planned cash handouts for pensioners and younger people. Heightened expectations surrounding additional stimulus may add further pressure to the space.
• Note that recent headline flow has flagged the latest parliamentary appearance for BoJ Governor Kuroda (which will take place around 09:50 Tokyo/00:50 London). There is nothing else of note on the local docket on Tuesday.