Japanese Yen (Jpy)
Strong demand for USD via BOJ swap lines has put pressure on the domestic repo market. The BOJ purchase plan for April is due out this afternoon.
There has been trade in short forwards and swap spreads are lower. The passage of the budget on Friday has paved the way for virus stimulus.
BEs spiraled sharply lower immediately after the Fed’s underwhelming TIPS buyback for the second straight session, ending an impressive run this week.
Trading in JPY swaps has been cautious with only light paying in 10-year in earlier trading. 2-year flow has flattened 2s/10s swaps.
BEs roared into TIPS buyback but sulked afterward as the real yield rally sourced better selling.
10-year JPY swaps saw light paying before turning offered after mid-day. 10-year JGB yield fell to below 0% again.
Listing of Asia Pacific structures and vanilla bonds sold by offshore issuers.
BEs continued to forge higher amid a solid risk-on move with continued Fed TIPS buyback serving as a backstop to end-user selling.
The Nikkei spikes and prompted paying from the 10-year point of the JPY swap curve. Tight JPY-USD spread has limited paying in 10-year.
BEs built boldly on already decent recent gains amid today’s risk-on rebound with dealers seeing better conditions for the asset class amid buybacks.