JGBS: Savage Bear-Steepener As US Long-End Sell-Off On China Fears
Apr-09 03:51
In Afternoon dealings, JGB futures have gapped lower, -34 compared to the settlement levels.
- (MNI The BoJ is closely analysing how US tariffs will affect Japan’s economy and prices, amid growing uncertainty, Governor Kazuo Ueda told lawmakers on Wednesday.
- The BoJ will manage monetary policy in an appropriate manner, while carefully monitoring the economy, prices and financial markets, he added, without elaborating on how and when the bank might act.
- The bank is also examining how the tariffs evolve and impact the BoJ's economic and price views, he continued.
- Today’s weakness in JGBs appears to be driven by moves in cash US tsys, which have extended their decline during the Asia-Pac session. The sell-off reflects growing concerns that China may retaliate against tariffs by offloading US assets, including tsys. At present, cash US tsys are trading 3–16 basis points cheaper across the curve.
- Cash JGBs have also bear-steepened, with yields 1-30bps higher. The benchmark 30-year yield is 28.3bps higher at 2.812%, a new cycle high and the highest since 2004.
- The swaps curve has twist-steepened, with rates 3bps lower to 20bps higher, pivoting at the 10-year. Swap spreads are tighter.
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BONDS: NZGBS: Modestly Richer, Middle Of Ranges, Light Local Calendar
Mar-10 03:43
NZGBs closed in the middle of the day’s ranges, with benchmark yields 1bp higher, on a local data light day.
- “New Zealand banking leaders told a parliament committee that the Reserve Bank's capital requirements may be too onerous and have pushed up interest rates. The leaders suggested that the current capital settings, which are based on a one in 200 year expected event, may be too severe and that a more balanced approach is needed.” (per BBG)
- Swap rates closed flat to 1bp lower, with the 2s10s curve modestly steeper.
- RBNZ dated OIS pricing is flat to 3bps softer across meetings. 25bps of easing is priced for April, with a cumulative 72bps by November 2025.
- Tomorrow, the local calendar will see Mfg Activity Volume, ahead of Card Spending on Wednesday.
- On Thursday, the NZ Treasury plans to sell NZ$250mn of the 4.50% May-30 bond, NZ$200mn of the 4.25% May-34 bond and NZ$50mn of the 5.00% May-54 bond.
JGBS AUCTION: 5-Year JGB Auction Results
Mar-10 03:40
The Japanese Ministry Of Finance (MoF) sells ¥1,751.2bn 5-Year JGBs:
- Average Yield: 1.157% (prev. 0.982%)
- Average Price: 99.74 (prev. 100.08)
- High Yield: 1.172% (prev. 0.989%)
- Low price: 99.67 (prev. 100.05)
- % Allotted At High Yield: 46.9172% (prev. 31.4296%)
- Bid/Cover: 3.1658x (prev. 3.5163x)
JGBS AUCTION: Poll: 5-Year JGB Auction
Mar-10 02:57
*JAPAN 5Y GOVT BOND AUCTION MAY HAVE 99.73 LOWEST PRICE:POLL – BLOOMBERG
