Tokyo CPI Prints Below Expectations Across All Measures

In post-Tokyo trade, JGB futures are cheaper, closing -16 compared to settlement levels, after cash US tsys finished 2-10bps cheaper across the major benchmarks. The curve flattened. US tsys trimmed a portion of Friday's gains as 2024 rate cut expectations were wound back, position squaring ahead of Friday's NFP print also weighed. FOMC dated OIS now price a terminal rate of 5.35% in Dec 24 with ~110bps of cuts by Nov 24. A softer-than-forecast Factory Orders saw Tsys briefly pare losses early in the NY session. The US calendar today sees ISM Services and JOLTS Job Openings.

• Tokyo Nov CPI prints a headline rate at 2.6% y/y versus a 3.0% estimate (prior 3.2%). Core and core-core also print below their projected levels at respectively 2.3% y/y and 3.6% y/y versus 2.4% est. (2.7% prior) and 3.7% est. (prior 3.8%). These results should support JGBs in the early rounds of the Tokyo session.
• Today, the local calendar also sees Jibun Bank Composite & Services PMI data for November, along with 10-year supply.