Swaps - JPY
There has been trade in 20-30 year swaps ahead of a superlong JGB auction today. Ultralong asset swaps have richened significantly in recent weeks.
Long JPY swap spreads have ticked higher in calm trade. Long-dated forward swaps are considered cheap after the recent push higher.
Disappointing jobs data in the US saw good receiving in 10-year JPY swaps. The long-end of the curve flattened out.
The superlong-end of the JPY swap curve saw receiving from foreign accounts. Dealers expect the long-end of the curve to correct flatter.
Negative news about Covid-19 vaccine trial has backed light receiving in 10y JPY swaps. 10s/30s swaps steepen more after weak JGB auction.
JGB future was a tad lower. Paying in 20-year has steepened 10s/20s swaps.
The 20y JPY swap spread has pushed to its least negative point in 3 months. The 20s/30s curve steepening trend is expected to continue.
Weak jobs data from the US has supported some receiving interest at the longer-end of the JPY swap curve.
Losses in the cash bond market saw light paying in 30-year JPY swaps. 10s/20s swaps are too steep and a corrective flattening is due.
The Japanese market saw a dampened risk appetite following a delay in the negotiation of a stimulus bill in the US. Long-dated JPY swaps were given.