Tokyo CPI lower Than Expected, Futures Higher Overnight

In post-Tokyo trade, JGB futures are richer, closing +17 compared to settlement levels, after US tsys finished the NY session 4-9bps richer after Q4 GDP printed 3.3% annualised growth, well above the consensus of 2.0%. Core PCE Price Index showed 2.0%, in line with consensus and prior. Initial Jobless Claims increased by 25k last week to 214k, suggesting that the previous week’s low was exaggerated by seasonal effects.

• Tokyo CPI printed at 1.6% y/y versus 2.0% est. and 2.4% prior. Tokyo CPI Ex-Fresh Food and Ex-Fresh Food & Energy also printed below expectations at 1.6% y/y and 3.1% y/y respectively versus estimates of 1.9% and 3.4%. The data should be positive for JGBs in early dealings.
• Also overnight, US Treasury Secretary Yellen said that surprisingly strong economic growth in the fourth quarter was a "good thing" that signals continued healthy consumer spending without increases in inflationary pressures.
• US tsys were also buoyed by comments from ECB policymakers that they were open to starting a discussion about future rate cuts in March if data points to inflation hitting 2% this year. A March pivot would pave the way for rate cuts, most likely in June - Reuters News.
• Today, the local calendar sees later PPI Services and Coincident & Leading Indices data, along with BOJ Minutes of Dec. Meeting.