LOOK AHEAD: UK Timeline of Key Events (Times BST)

JGB futures are holding weaker, -15 compared to settlement levels, but higher than overnight closing levels seen on Friday.

• There hasn’t been much in the way of domestic drivers to flag, outside of the previously outlined 4Q GDP (final) and M2 & M3 Money Stock data. Machine Tool Orders are due later today.
• (Bloomberg) -- The Bank of Japan is widely expected to scrap the world’s last negative interest rate in the coming weeks, marking the closing act of global central banks’ grand experiment with unorthodox policies. Governor Kazuo Ueda is forecast to raise the short-term rate from -0.1% either next week or in April in what would be the first rate hike in Japan since 2007, according to economists and bond traders. (See link)
• Cash US tsys are dealing 1bp cheaper to 1bp richer in today’s Asia-Pac session, with a flattening bias. News flow has been light.
• The cash JGB curve has bear-steepened, with yields flat to 4bps higher across benchmarks. The benchmark 10-year yield is 2.8bps higher at 0.763% after earlier testing the highest level for the year at 0.772%.
• The swaps curve has twist-steepened, pivoting at the 10s, with rates 2bps lower to 3bps higher. Swap spreads are tighter.
• Tomorrow, the local calendar sees PPI and BSI Business Conditions data, along with 5-year supply.

TYM4 is trading at 111-27+, +0-04 from NY closing levels on Friday.

• Cash US tsys are dealing 1bp cheaper to 1bp richer in today’s Asia-Pac session, with a flattening bias.
• News flow has been light so far today.
• After Friday’s mixed Employment Report, the market’s focus now turns to Tuesday's CPI release, the last key data point ahead of the March FOMC meeting (19-20 March).
• (Bloomberg) -- Investors should consider selling 10-year Treasuries as the resilience of the world’s largest economy makes the recent US bond rally look overdone, according to Barclays Plc. (See link)

In roll-impacted trading, ACGBs (YM +1.4 & XM +1.5) are slightly richer after dealing in narrow ranges in today’s Sydney session. Without domestic data catalysts, local participants appear to have been content to use US tsy dealings in today’s Asia-Pac session for directional guidance. Cash US tsys are dealing 1bp cheaper to 1bp richer, with a flattening bias.

• Cash ACGBs are 1-2bps richer, with the AU-US 10-year yield differential unchanged at -11bps.
• Swap rates are 1-2bps lower, with the 3s10s curve flatter.
• The bills strip is 2-3bps richer.
• RBA-dated OIS pricing is flat to 4bps softer across meetings, with late-24 leading. A cumulative 48bps of easing is priced by year-end.
• Tomorrow, the local calendar will see NAB Business Confidence, along with Panel Participation by RBA Assistant Governor (Economics) Sarah Hunter at the AFR Business Summit.
• Tomorrow, the AOFM plans to sell A$150mn of 0.25% Nov-32 inflation-linked bond.
• (AFR) Interest rates may be heading lower as inflationary pressures sparked by the pandemic recede, but they are unlikely to stay there as major geopolitical and macroeconomic forces will push them higher. (See link)