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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
STIR FUTURES
Continued reaction to the news of the newly discovered B.1.1.529 Covid-19 variant in STIR markets with the Eurodollar strip leading the moves (although some of that playing catch up with the moves higher in short sterling and Euribor over Thanksgiving).
- Eurodollar futures up 5.5 ticks for the Mar-22 contract, 9.5 ticks for Jun-22, 12.5 ticks for the Sep-22 and then generally 15 ticks higher for the Reds, and moves almost as large in Greens and Blues. Now around 3 hikes priced into the strip for 2022.
- Short sterling futures up 3.0 ticks for the Dec-21 contract and then 7.5-9.5 ticks for other Whites, Reds and Greens. In addition to the Covid-19 variant news, we also had more comments from BOE's Bailey last night who suggested that inflation needed to be watched if wages pushed higher - seemingly implicitly confirming that he hadn't been too concerned about developments in wages so far. Pill's comments at 13:00GMT will be watched as he speaks on the economic outlook and is considered one of the members needed to vote for a hike for it to go ahead. In terms of pricing, December is now looking around 50% priced but February is still largely priced in for a 15bp hike. Instead of rates of around 1.25% by the end of 2022, markets are now only fully pricing hikes to 1%.
- In Euribor, the curve is flattening in the White and Red area and up 7-9 ticks in the Green/Blue area. Markets are now pricing around one 10bp hike for 2022.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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