Tsys Tight Owing To Labour Day, JGBs & ACGBs Biased A Little Cheaper

Broader macro news flow remains light, which, when coupled with the observation of the Labor Day holiday in the U.S. (and related closure of cash Tsy markets until Tuesday's Asia-Pac open), is limiting broader market activity. T-Notes last -0-01 at 133-11+, operating within the confines of a narrow 0-02+ range. A 2.4K block buy of TYZ1 futures headlined on the flow side during Asia-Pac hours,

• The latest round of political and COVID-related developments/chatter have provided little impetus for the JGB space early this week, with benchmark cash JGBs running little changed to 0.5bp cheaper across the curve, while some widening has been seen in longer-dated swap spreads. JGB futures print a little softer than their overnight closing levels, -8, after showing below the range witnessed at the back end of last week. A sustained break of Friday's post-Tokyo trade lows (151.90) would switch technical focus to the Jun 17 low (151.49). There has been little in the way of idiosyncratic news flow since the re-open, with participants looking ahead to tomorrow's 30-Year JGB supply.
• Aussie bond futures have stabilised, ticking away from their respective early Sydney lows, leaving YM unch. & XM -3.5 at typing. The NFP-spill over downtick, which saw XM have a shallow look below Friday's post-Sydney session lows, likely had an element of input from Australian PM Morrison's reiteration of plans to move past the era of hard state borders and lockdowns come Christmas, although this wasn't fresh information. Elsehwere, there has been little in the way of market moving news, with focus on tomorrow's RBA decision.