MNI China Daily Summary: Monday, July 22

MNI BRIEF: PBOC Lowers Ceiling of Its Interest Corridor

MNI: China CFETS Yuan Index Down 0.05% In Week of Jul 19

MNI: PBOC Sets Yuan Parity Higher At 7.1335 Mon; -1.18% Y/Y

MNI: PBOC Conducts CNY58.2 Bln Via OMO Mon; 7day Repo Rate Cut

MNI BRIEF: PBOC Cuts 7-Day Repo Rate By 10bp

CBRT Data Watch

NBH Data Watch

Pay concerns push back easing expectations; curve flattens

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

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Bear Flattening

GILT SUMMARY

The gilt curve has bear flattened with the short-end staying offered through the day.

  • The Dec-20 gilt future trades at 136.43, towards the bottom end of the day's range and 9 ticks off the low.
  • Cash yields are 2-6bp higher on the day, while the 2s30s spread is 3bp narrower. Last yields: 2-year -0.07%, 5-year -0.0903%, 10-year 0.1916%, 30-year 0.7387%
  • The BoE's Bailey earlier stressed that while technical work into the implementation of negative policy rates was ongoing, a move in this direction was not on the cards in the near term.
  • The DMO today tapped the 0.50% Oct-61 gilt through syndication. GBP6.5bn was allocated with the price set at 94.161 and yield at 0.6626%.
  • The BoE purchased GBP1.473bn of long-dated gilts with an offer-to-cover of 2.07x.
  • Having tentatively started to open up the economy, the UK government has now reintroduced social restrictions which could last for six months.
  • Tomorrow sees the release of preliminary September PMI data at 0930BST.
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