The Japanese Ministry of Finance.......>

JGBS AUCTION: The Japanese Ministry of Finance (MOF) will today sell Y1.0tn of

20-Year JGB's, representing a re-opening of JB165. The MOF last sold 20-Year

debt on July 12, the auction drew cover of 4.537x at an average yield of 0.492%,

average price of 100.13, high yield of 0.494%, low price of 100.10, with

63.8373% allotted at the high yield.

- Outright 20-Year yields have operated in ~16bp range since the most recent

auction, with JGBs experiencing heightened vol. after the BOJ adopted a more

flexible approach to its 10-Year yield target, as Kuroda pointed to a band of

-/+0.2% for 10-Year yields & the curve steepening as a result, although

volatility has cooled in recent sessions, allowing benchmark 20-Year yields to

settle and last trade at ~0.620%. It is worth noting that the most recent

30-Year auction (on 09 Aug) passed smoothly, with similar expectations this time

around. Japanese lifer Fukoku Mutual has urged the BOJ not to worry about the

recent uptick in JGB yields, stressing that 1.0% yields in the 30-Year zone

would trigger demand from the sector.

- Results due at 0435BST/1235JST.