Weakness Elsewhere Weighs

JGB futures have extended on their overnight weakness during the Tokyo afternoon, playing catch up to the aforementioned round of U.S. Tsy weakness, to last print -23 on the day. The 4- to 5-Year zone of the cash curve has richened a little on the day, while the remainder of the curve sits up to 1.5bp cheaper, with the 7- to 10-Year sector underperforming.

• Better than expected local monthly retail sales data had little in the way of tangible impact on the space, with the same holding true for the virtually in line with expectations labour market report.
• The low price at the latest 2-Year JGB auction came in below broader dealer expectations (100.260 per the BBG dealer poll), with the cover ratio sliding and tail widening. Looks like the proximity to FY end may mean that Japanese investors chose to keep at least some of their powder dry, which could stem from the allure of the yield of some foreign core global bonds in FX-hedged terms.
• We also saw the Philippines price Y55bn of 3-Year Samurai paper.
• BoJ Governor Kuroda's latest round of rhetoric revealed nothing in the way of fresh information.