Underpinned By Bid In Long End

The JGB space played catch up to Friday's late NY/Monday's early Asia rallies in core global FI markets at the Tokyo re-open, before pulling back from firmest levels of the day. Futures finished +19, after core FI markets moved away from best levels despite a lack of notable headline flow. Although JGB futures were able to lean on some richening in the longer end of the domestic cash curve, with fresh bull flattening apparent during afternoon trade. 10-Year JGB yields hover back around 15bp after a brief showing above 18.0bp on Friday (in turn affording the BoJ some breathing space re: the need to enforce its permitted trading range for 10-Year JGB yields). Local headline flow was light, with the latest round of 3-5 Year BoJ Rinban operations unchanged in terms of purchase size and drawing an offer to cover ratio of 3.20x (prev. 3.65x).