STIR: ~65bp Of BoE Cuts Through Year-End Still Priced, Mann Interview Eyed

GBP STIRs little changed from settlement, with comments from BoE hawk-turned-dove Mann and Trump’s latest tariff moves/rhetoric still being digested.

• BoE-dated OIS shows ~64bp of cuts through year-end, which encompasses fairly low odds of a follow up cut in March (~6bp) and 26.5bp of easing through May.
• SONIA futures +2.0 to -1.5, twist steepening.
• BoE’s Mann told the told the FT that she believed that “companies will struggle to raise prices this year as consumers are hit by job losses and spending softens.”
• However, the article noted that her vote for a 50bp cut shows a “desire for a one-off step-change rather than a longer-term succession of ongoing rate reductions.”
• This confirms that Mann may not be a long-standing dove (as we suspected - and as hinted by her description in the Minutes that rates need to remain restrictive). We still don’t know her view on the terminal rate and expect her to vote for cuts for at least another 2 meetings.
• Mann's follow up speech (08:45GMT) is likely to shed further light on her views.
• Elsewhere, BoE Governor Bailey will also speak (12:15GMT), on the topic of “Are we underestimating changes in financial markets?”