Tsys Tight, JGB Auction Sees Firm Demand

T-Notes still hold to the same 0-03 range that we outlined earlier, with futures now +0-01+ at 138-24+, as yields sit unchanged to 0.8bp richer across the curve. It is fair to say the Pence-Harris debate was somewhat bland, with a flow related pop higher in e-minis allowing T-Notes to edge away from best levels at one point.

• Afternoon trade saw a bid creep into the JGB space, with futures moving to best levels of the day in the wake of a strong 5-Year auction, last +5, with the belly outperforming in cash trade post-auction. Elsewhere, BoJ Governor Kuroda pointed to a moderate economic recovery in Japan, as he reiterated his view on monetary policy in front of BoJ branch managers.
• The Aussie bond curve holds steeper vs. settlement levels, with YM -1.0 and XM -3.0, after the latter had a look below its SYCOM lows, with little to go off. Bills sit unchanged to 2 ticks lower on the day.