Subdued Session, Light Calendar, Futures Richer At Session Bests

JBU3 is sitting at Tokyo session highs in afternoon trade at 148.42, +10 compared to the settlement levels.

• With domestic drivers light on the ground, local participants have likely been on headlines and US tsys watch. US tsy futures are trading slightly firmer in Asia-Pac trade. A reminder that cash tsys are closed today due to the observance of a US national holiday.
• Tokyo Condominiums For Sale, the only release today, showed a 21.5% y/y decline in May. There was no immediate market reaction, as expected, to the data.
• Cash JGBs strengthen over the Tokyo session to be flat to 1.2bp richer across the curve with the 10-year benchmark leading. The 10-year yield is at 0.400%, below the BoJ's YCC limit of 0.50%. The 5-year benchmark is 0.4bp lower at 0.077%, ahead of supply later in the week.
• Swap spreads are generally tighter across the curve except for the 7-20-year zone.
• The local calendar tomorrow sees Industrial Production (Apr F), Capacity Utilisation (Apr) and Machine Tool Orders (May F).