The bear steepening observed in JGBs, owing....>

JGBS: The bear steepening observed in JGBs, owing to a positive session for

Japanese equities, extended in afternoon trade. This was on the back of a less

than inspiring 40-Year JGB auction which saw the high yield top exp., with the

cover ratio easing back from the levels seen in Jan '19 & Nov '18, albeit

holding in line with '18's 40-Year auction average. The flatness of the curve

owing to the dovish pivot from global central banks, lack of relative value &

window dressing into the end of the Japanese FY likely stymied dealer

participation, although, all in all, the auction still passed smoothly enough.

- Futures trade through 153.00 as we head towards the close.

- The summary of opinions from the BoJ's March MonPol decision revealed

heightened downside risks to econ activity & prices prompted board members to

discuss the MonPol outlook, though they didn't see the need for imminent action.

- Also worth highlighting that MNI understands that BoJ off'ls are concerned

that China's economy may fail to respond to Beijing's stimulus measures, in turn

putting further downward pressure on Japan's industrial production & exports,

increasing the chances the BOJ will need to consider additional easing measures.