JGB Auction Preview

Latest edition · July 1, 2026

JGB Strategy

Mizuho Securities presents a preview of the upcoming 10y JGB auction, balancing yield-based incentives against market anxiety surrounding Japanese fiscal policy. The report recommends a cautious approach using 7s10s flatteners.

Ahead of a JPY 2.6 trillion 10y JGB auction, the report weighs factors such as absolute yield levels and curve cheapness against the negative impact of perceived reflationary government policies under the Takaichi administration. While the 10y sector is cheap on the curve, asset swap richness and potential fiscal concerns limit outright conviction. The suggested strategy involves cautious positioning through 7s10s flatteners to capitalize on relative value while mitigating exposure to near-term volatility.

Key takeaways from the latest edition

• 1.The MOF will auction approximately JPY 2.6 trillion of the new 10y JGB (JB383).
• 2.Potential demand exists due to absolute yield levels and current curve cheapness, though reflationary policy concerns persist.
• 3.Strategists recommend focusing on 7s10s flatteners as a relative value play, given caution regarding potential upward pressure on long-term rates.

What this series covers

• (1) Positives and negatives ahead of the 10y auction
• (2) Auction strategy
• (3) Key charts

Edition archive

• JGB Strategy

  July 1, 2026

• JGB Strategy (1)

  June 1, 2026

• Mizuho 10y JGB auction preview: Yield levels should provide some support despite ongoing uncertainties 20260511

  May 12, 2026

• JGB Strategy

  May 11, 2026