Tight In Asia

The flattening bias and light bid remained in the U.S. Tsy space in Asia-Pac hours, with Sino-U.S. tensions still dominating the headline flow in a news-light session. Still, impending risk events in the form of the minutes from the latest FOMC decision and 20-Year Tsy supply (both due Wednesday) provide the focal points for the space over the next 24 hours. T-Notes held to a 0-02+ range, last +0-01+ at 139-14, yields sit unchanged to 1.2bp richer.

• Light underperformance in the belly of the cash curve provided some pressure for JGB futures, with that contract last -3, after a brief look through the overnight highs early on in Tokyo. Both of the buckets covered by the BoJ's 3-10 Year Rinban ops saw a widening of spreads and very modest upticks in cover ratios, although there wasn't any evidence of notable selling, with the 5-10 Year offer/cover holding comfortably below 2.00x.
• Little movement in the Aussie bond space during Sydney hours, with futures sticking to tight ranges, YM -0.5 and XM unchanged at typing. The lack of ACGB purchases from the RBA and strong ACGB Dec '30 offering have done little for the broader market. Cash curve a touch flatter, with very modest twisting seen.