OIL: Crude Down Thursday, Watching Upcoming Trump-Xi Meeting

• MNI JAPAN AUG FACTORY OUTPUT -1.2% M/M; JULY -1.2%
• JAPAN AUG FACTORY OUTPUT POSTS 2ND STRAIGHT M/M DROP

• MNI JAPAN AUG RETAIL SALES +1.1% Y/Y; JULY +0.4%
• JAPAN AUG RETAIL SALES -1.1% M/M; JULY -1.6%

In post-Tokyo trade, JGB futures closed slightly stronger, +3 compared to settlement levels, after US tsys finished Monday's session 2-5bps stronger, with a flatter curve.

• US Government shutdown concerns buoy Tsys into the close. The BLS' key economic releases would be postponed in the event of a government shutdown, per the Department of Labor's plan for such an event.
• Fed Musalem said the Fed must be cautious cutting interest rates further because inflation remains too high, Fed Williams: policy decisions on a meeting-by-meeting basis, adding that this month's rate cut made sense given rising risks to employment, and leaves monetary policy at still-restrictive levels.
• MNI: Japan Govt Keeps Economic View; Ups Spending, Capex. Japan's government slightly tweaked its economic assessment in September, upgrading views on private consumption and capital investment for the first time in over a year, though leaving its overall judgment largely unchanged, the Cabinet Office said Monday.
• MNI INTERVIEW: BOJ Decisions Inconsistent - Ex-BOJ's Yamamoto. Markets are watching Bank of Japan communications more closely than economic data for signals on policy moves, with board decisions seen as inconsistent and driven by convenience rather than fundamentals, former BOJ Executive Director Kenzo Yamamoto told MNI.
• Today, the local calendar will see BOJ Summary of Opinions (Sept. MPM), Industrial Production, Retail Sales and Housing Starts.