~65bp Of '24 BoE Cuts Still Priced

BoE-dated OIS steady, showing 66bp of ’24 cuts.

• SONIA futures are unchanged to +2.5.
• Weekend news stories suggested that UK PM Sunak is looking to reduce welfare spending to fund further tax cuts.
• Comments from BoE hawk Mann are due later today (17:00 London).
• Tomorrow’s labour market report is they key domestic risk event of the week.
• Ahead of that release, survey data has pointed to a continued cooling in the labour market.
• The KPMG-REC report noted that “recruitment activity across the UK continued to weaken midway through the opening quarter of the year.”
• Meanwhile, the BBG-Reed report noted that “job vacancies in England have fallen to their lowest in more than three years.”
• Wage movement will be key in the BoE’s fight against inflation.
• The KPMG-REC report noted that “the rate of salary inflation was the slowest recorded in nearly three years.”
• A continued cooling in wage pressure, if witnessed, would remove one argument for higher for longer interest rates.