JPY Swaps: 7-10y well bid; Early 2y paying on FX move; SoftBank 5y deal

Chart red numbers 13 Jun 2022
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Strong domestic data continued to back paying in JPY swaps with some good amount of flow in the 7-10y area. Softbank in JPY120bn 5y retail bonds.

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  • 10y JGB yield stays above 0.5%

  • 7-10y well bid; Early 2y paying on FX move

  • New issues – SoftBank JPY120bn 5y deal

 

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10y JGB yield stays above 0.5%

Stronger-than-expected domestic data and the selloff in USD rates market in overnight trading saw extended losses in the JPY rates market.

 

Official data released earlier today showed that domestic PPI in January was up 1.6%. Economists had expected the growth to stay unchanged at 1.5%. On Tuesday, short-dated US treasury yields spiked on renewed worries over further aggressive US Fed hikes and following weak demand at the 2-year sale.

 

The lead bond future was down by 32-ticks in the morning before closing the day 21-ticks lower at 146.22. The yield on the benchmark 10-year JGB rose to 0.504% intraday.

 

 

7-10y well bid; Early 2y paying on FX move

10-year swaps have been well bid despite ahead of the bank holiday tomorrow. A dealer reported paying at up to 0.905% in the morning although the majority of the flow has been in a tight range around 0.75bp higher of 0.865%. The source said 10-year JGB yield stubbornly staying at above 0.5% has been the drive for paying in 10-year on the day.

 

The spike in front-end US treasury yields also saw USD/JPY shooting up to above 135.2 in overnight trading, prompting some paying in 2-year at 0.75bp higher of 0.1975% soon after market open.

 

7-year traded mostly in a tight range around 0.5bp higher of 0.65% on the day, although there was sporadic paying at up to 0.7% in the morning. 2s/7s swaps steepened up by 0.75bp to 46.25bps as 2-year swap rate turned lower in the afternoon session.

 

 

New issues – SoftBank JPY120bn 5y deal

  • Hikari Tsushin Inc sold JPY30bn in 0.470%, February 27, 2026 bonds.

     

  • JACCS Co Ltd raised JPY50bn via selling the following bonds:

     

    • JPY10bn, 0.824%, March 01, 2028 at JGBs + 55bps.

    • JPY40bn, 0.440%, February 27, 2026.

     

  • Mitsui Chemicals issued JPY15bn in 0.300%, February 27, 2026 bonds.

     

  • Mizuho Leasing priced JPY40bn in 0.764%, March 01, 2028 bonds at JGBs + 49bps.

     

  • The mobile unit of SoftBank Corp has priced JPY120bn in 0.98% 5-year retail bonds.

     

  • Sumitomo Corp  sold JPY35bn worth of bonds as follows:

     

    • JPY10bn, 0.644%, March 01, 2028 at JGBs + 37bps.

    • JPY25bn, 0.949%, March 01, 2030 at JGBs + 49bps.

     

  • Tokyo Metropolitan Government issued JPY30bn in 0.349%, February 20, 2027 bonds. Priced at JGBs + 11bps.

     

  • Tokyu Fudosan Holdings raised JPY20bn via selling bonds in two equal tranches as follows:

     

    • 0.320%, February 27, 2026.

    • 0.694%, March 01, 2028 at JGBs + 42bps.

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