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.