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Tepid 20-Year Auction

JGBS

The latest round of 20-Year JGB supply saw the low price meet broader dealer expectations (as proxied by the BBG dealer poll), although the remaining metrics surrounding the auction were not as firm. The length of the tail widened a little vs. the prev. round of 20-Year supply, while the cover ratio eased (moving back below the 6-auction average of 3.50x), printing at the lowest level witnessed at a 20-Year auction since February in the process. It looks like supply worry and the lack of outright yield on offer may have outweighed the carry and roll proposition/recent, modest cheapening.

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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