JPY Swaps: Light 10y offers despite trade surplus surprise

Kyoto bamboo forest
JPY swaps saw light receiving despite a surprising trade surplus in June, as the dovish comments from Ueda still outweighed the data.

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  • JGB future firmer despite trade surplus surprise

  • 10y offers flatten 2s/10s

  • New issues


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JGB future firmer despite trade surplus surprise

Japan posted a surprising trade surplus in June, coming in JPY43bn against consensus of JPY46.7bn of deficit. These also compared to JPY1.38trn worth of deficit in May. The surplus was driven mainly by a slowdown in imports. Exports, on the other hand, grew by only 1.5% year-on-year, missing economists’ forecast of 2.4% of growth.


JGB future was therefore firmer. Dealers said market participants were also still “trading the news” after BOJ Governor Ueda’s dovish comments. “People are less concerned about the inflation data tomorrow although they generally think that it’s a good idea to wait and see,” a trader said of the rather subdued trading in swaps today.


JGB future was up 11-ticks at 147.92 in mid-afternoon Tokyo trading, and the yield on the benchmark 10-year JGB was down 0.5bp at 0.455%.



10y offers flatten 2s/10s

The source reported swap flow mostly around 10-year on the day. It traded between 0.65% and 0.6575% in the morning session, down from previous close of  0665%. Receiving turned slightly more aggressive around mid-day and 10-year was last traded around 0.645%.


2s/10s swaps flattened out by 0.75bp to 59bps at time of writing.



New issues

  • GLP J-Reit sold JPY2.6bn in 0.900%, July 26, 2033 bonds.


  • JEHDR issued the following bonds:


    • JPY10bn, 0.668%, July 28, 2033 at JGBs + 21bps.

    • JPY15bn, 1.101%, July 27, 2040 at JGBs + 13.6bps.

    • JPY15bn, 1.247%, July 28, 2045 at JGBs + 7.6bps.

    • JPY17bn, 1.148%, July 28, 2042 at JGBs + 8.8bps.

    • JPY18bn, 1.165%, July 28, 2043 at JGBs + 6.5bps.


  • Mizuho Financial raised JPY261bn via selling the following perpetual bonds:


    • JPY101bn, 2.143% with semi-annual call at par from December 2033.

    • JPY160bn, 1.785% with semi-annual call at par from December 2028.


  • SCSK Corp priced JPY10bn in 0.395%, July 26, 2028 bonds at JGBs + 29bps.