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Soft Cover At 40-Year Auction


Continued Tick Lower


40-Year JGB Auction Results


Hong Kong Bucks Broadly Negative Trend


Oil Adding Some Pressure


Steepening Pressure Lingers


U.S. fiscal matters remain in the driving seat, with little else to write home in the Asia-Pac morning. T-Notes have slipped after the the House of Representatives ok'd U.S. Pres Trump's demand to increase stimulus checks to $2,000 from $600 in a bipartisan vote. Senate Minority Leader Schumer announced he will try to pass the proposal Tuesday, albeit it faces political headwinds in the Senate. A fair number of GOP Senators remains opposed to the bill, despite the backing of the sitting Republican POTUS. In a subsequent vote, the House chose to override Pres Trump's veto of a defence policy bill, sending it to the Senate. T-Notes trade -0-02 at 137-27+, operating within a 0-04 range, with lingering optimism re: Pres Trump's recent approval for the Covid-19 relief bill adding to the general mood music. Cash Tsy curve runs slightly steeper, with yields last seen -0.4bp to +2.0bp. Eurodollar futures run unch. to +0.5 tick through the reds.

  • JGB futures remain rangebound & trade sideways, last sitting at 151.98, 4 ticks above last settlement. Cash JGB yields generally sit marginally below neutral levels. To recap, on Monday the BoJ lowered the purchase range for 1-3 Year JGBs in its Rinban plan for January. The local docket is empty today, but focus fell on stock mkt dynamics as the Nikkei 225 crossed above 27,000 for the first time since 1991.
  • Australian YM trades unch., XM sits +2.0 ticks as we type. Cash ACGB yields sit below neutral levels, with 10s outperforming. Bills last trade unch. to -1 tick through the reds.
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