JGBS: Futures Flat At Lunch
Mar-01 02:31
At the Tokyo lunch break, JGB futures are flat compared to the settlement levels.
- There hasn’t been much in the way of domestic drivers to flag, outside of the previously outlined labour market and Jibun Bank PMI Mfg data, and comments from BoJ Governor Ueda.
- (Bloomberg) -- Bank of Japan Governor Kazuo Ueda said the Bank of Japan’s price target is not yet in sight, tempering market speculation that the bank’s first rate hike since 2007 is just around the corner. (See link ICYMI)
- Cash JGBs are cheaper across maturities, with yield movement ranging from flat (20-year) to 1.6bps higher (5-year). The benchmark 10-year yield is 1.2bp higher at 0.721% versus the Nov-Dec rally low of 0.555% and the February high of 0.772%.
- Swaps are little changed, with swap spreads mostly tighter.
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CROSS ASSET: USD Firms, Equities Under Pressure, Yields Mostly Lower
Jan-31 02:28
The USD has tracked higher in recent dealings, the BBDXY up around 0.15% to 1237.40. This leaves us within recent ranges though. Tuesday's US session high was near 1238 (post the JOLTS beat).
- AUD/USD is the weakest performer, down 0.60%, last in the 0.6560/65 region. We had the earlier Q4 CPI miss, along with a slightly weaker than expected manufacturing PMI out of China.
- China equities are lower, with property concerns still evident. Metal commodities are softer in terms of both iron ore and copper, which is a likely drag on the AUD.
- US equity futures also sit comfortably in the red, led by the tech sector after late US earnings misses.
- US Tsy futures briefly popped above Tuesday highs but we have since consolidated.
- The lower US yield backdrop has likely helped yen at the margins. USD/JPY sits unchanged, last at 147.60/65. Earlier lows were just under 147.20, post a hawkish read from the BoJ summary of opinions from the Jan policy meeting.
- JGB futures are up from lows, but holding an offered tone, in contrast to trends elsewhere.
MNI EXCLUSIVE: BoJ & The Potential To Exit Negative Rates In March
Jan-31 02:04
MNI discusses whether the BOJ may its exit negative rates policy in March --On MNI Policy MainWire now, for more details please contact sales@marketnews.com.
NZD: Dragged Lower Post AU CPI & Weaker China Miss, AUD/NZD Lower
Jan-31 01:57
- AU CPI was out earlier, missing estimates and dragging NZD/USD lower. We were last at 0.6125/30, off a modest 0.15%. AUD/NZD is lower though, last near 1.0730, still within recent ranges of 1.0700/1.0800.
- ANZ sentiment readings out earlier printed Business Confidence at 36.6 vs 33.2 prev, and Activity Outlook 25.6 vs 29.3 prev.
- The weaker China manufacturing PMI at 49.2, slightly below estimates, has presented an additional headwind
- Note, RBNZ Gov Orr is next scheduled to deliver a keynote speech at 7.40am, Friday 16th about the changing driving inflation.
