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State Of Emergencies To The Fore

JGBS

The cash space saw modest richening across the curve during the morning, with some outperformance for 7s potentially linked to the bid in futures (1.5bp of richening for that benchmark). The latter hit the lunch bell 7 ticks above Friday's settlement levels. The previously flagged Tokyo state of emergency questions and the broader (modest) risk aversion evident in early trade this week has provided support for the space, even with the Nikkei 225 unwinding its early losses.

  • The lunch break has seen the Governor of Osaka note that the region will request the implementation of a state of emergency, with Chief Cab. Sec. Kato noting that prompt consideration is required re: the Tokyo & Osaka state of emergency situations.
  • A quick look at the offer/cover ratios witnessed in today's BoJ Rinban operations (note that the 25+ Year operations represented the first round of operations in that bucket since the well-documented tweaks announced at the back end of March) revealed the following:
  • 3- to 5-Year: 4.12x (prev. 3.30x)
  • 25+-Year: 4.30x (prev. 4.24x)
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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