Cash JGBs are flat to 2bp richer, with 5s outperforming on the curve. The long end lags the bid, likely owing to the presence of this afternoon’s 40-Year JGB supply. Futures nudged higher at the re-open, but remain comfortably within their recent rage, last +11.

• Headlines surrounding the summary of opinions of the BoJ’s January meeting have largely reaffirmed familiar rhetoric, stressing the need for continued easing, as well as a requirement for more time to assess December’s surprise YCC tweak. There is also hope that the well-documented adjustments to the BoJ’s funding operations help improve market functioning. There was also some inference re: the Bank’s inflation goal being some distance away, while well-documented upside risks to inflation were highlighted.
• Elsewhere, a Nikkei article re: the allocation of capital on the part of Japanese investors provided the following snippets:
• “I plan on buying more JGBs once I redeem foreign bonds.”
• “If long rates rise to around 0.7%, JGBs will become an attractive instrument that is both liquid and creditworthy.”
• “Life insurers could shy away from long-term government bonds if they expect the BOJ to further adjust its policy, which would drive down bond prices.”
• “Life insurers in particular are placing their proceeds from unloading foreign bonds into deposits and other short-term investments, so they have significant capacity to buy more JGBs.”