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The BOJ maintained the size of its 1-5 Year....>

JGBS: The BOJ maintained the size of its 1-5 Year Rinban operations on Monday,
but offered to buy an unlimited amount of 10-Year JGBs via a fixed rate
operation at 0.11%. This was the first fixed rate operation since February and
was used to respond to the sharp rise in yields after Friday's BOJ source report
re: policy adjustment, however, no offers were tendered. The yield offered was
some way off market, and points to continued support from the BOJ, for now.
- The announcement of the fixed rate operation put a bid into the space,
although that faded later in the day, with the curve finishing notably steeper.
- Looking at the breakdown of the BOJ's Rinban operations, the 1-3 Year bucket's
offer to cover ratio eased to 4.41 from 5.36, while the 3-5 Year bucket's offer
to cover ratio held relatively steady at 3.44.
- JGB futures' were contained by resistance at the 200-DMA (Y150.74) & support
at the high from Feb 01 (150.36).
- Participants now look to today's 40-Year JGB supply.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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