The JGB space followed global bonds lower on...>

JGBS: The JGB space followed global bonds lower on Friday in the wake of the BBG

sources piece re: Trump asking his cabinet to draft a potential China trade

deal.

- The curve was subjected to modest steepening, with 20-Year paper

underperforming.

- Friday saw the BoJ raise the size of its 1-3 & 3-5 Year Rinban ops by Y50bn

apiece, after trimming the amount of ops covering the buckets in Nov to 4, prev.

5. If these rates are applied through the remainder of the month the BoJ will

buy Y1.4tn worth of 1-3 Year paper & Y1.6tn worth of 3-5 Year paper. This

compares to Y1.5tn & 1.75tn worth of the respective buckets at the prior sizes

over 5 purchases, pointing to a net Y250bn reduction in monthly purchases. 5-10

Year purchase sizes were left unchanged.

- The offer to cover ratio of the operations of the ops were as follows:

- 1-3 Yr 2.87 (prev. 2.99), 3-5 Yr 2.61 (prev. 2.62), 5-10 Yr 2.44 (prev. 2.60)

- Focus today turns to BoJ Rinban operations covering 10-25+ Year JGBs and a

speech from BoJ Gov. Kuroda.