JPY Swaps: Light 10-30y bid; Curve steeper to back-end

Steep grades 15 Jun 2020
JPY swaps from the 10y point saw light paying, and the curve steepened up all the way to the back-end.

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  • Light 10-30y bid; Curve steeper to the back-end

  • New issues


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Light 10-30y bid; Curve steeper to the back-end

JGB future extended losses today, underperforming the selloff in short-dated US treasuries in overnight trading.


The sentiment in the JPY rates market has also been supported by an improvement in PPI, which grew at 0.1% month-on-month in July following 0.1% of contraction in the previous month.  


In early-afternoon Tokyo trading JGB future was down 27-ticks at 146.9, and the yield on the benchmark 10-year JGB was little changed at 0.58%.


Trading in swaps has been largely from the 10-year point with relatively busier flow in 10-year. A trader noticed paying in 10-year mostly between 0.76% and 0.7675% in the morning, up from previous close of 0.75%.


30-year traded briefly between previous close of 1.275% and 1.3% near market open but trading interest there faded very soon.


Price action along the curve in later trading saw steepening of the curve all the way to the back-end. 10s/30s swaps steepened up by a basis point to 53.5bps at time of writing.



New issues

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


    • JPY15bn, 1.360%, August 17, 2033 at JGBs + 78bps.

    • JPY35bn, 0.799%, August 17, 2028 at JGBs + 62bps.


  • Aichi Prefecture priced JPY10bn in 0.720%, August 25, 2033 bonds at JGBs + 16bps.


  • Central Nippon Expressway issued JPY120bn in 0.439%, June 17, 2028 bonds. Priced at JGBs + 26bps.


  • Fukuoka City sold JPY20bn worth of bonds in two equal tranches as follows:


    • 0.892%, August 21, 2043 at JGBs + 28bps.

    • 1.294%, August 21, 2043 at JGBs + 5bps.


  • JEHDR issued the following bonds:


    • JPY10bn, 0.740%, June 19, 2033 at JGBs + 16bps.

    • JPY15bn, 1.186%, August 19, 2039 at JGBs + 15bps.

    • JPY21bn, 1.304%, August 21, 2043 at JGBs + 6bps.

    • JPY6bn in 1.385%, June 21, 2045 bonds at JGBs + 7.4bps.


  • Osaka City priced JPY10bn in 1.585%, August 20, 2053 bonds at JGBs + 10bps.