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Sideways Trade Continues

JGBS

JGB futures oscillated either side of unchanged levels during Tokyo trade, dealing -3 into the bell, sticking to a tight range, while cash JGBs sit 1bp richer to 1bp cheaper across the curve. There hasn’t been much in the way of a meaningful domestic catalysts, leading to a lack of conviction in JGB trade.

  • Offer/cover ratios nudged higher in the latest round of BoJ Rinban operations, perhaps as participants use the move away from recent cheaps in those maturities as a selling opportunity:
  • 1- to 3-Year: 3.59x (prev. 2.74x)
  • 3- to 5-Year: 2.50x (prev. 1.60x)
  • Comments from PM Kishida underscored the BoJ’s independence when it comes to setting monetary policy, while he refrained from commenting on the outlook for the JPY.
  • Weekly international security flow data and the latest liquidity enhancement auction for off-the-run 5- to 15.5-Year JGBs will be seen on Thursday.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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