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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
Ahead of the BoC and RBNZ policy meetings tomorrow, all $-Bloc STIR markets have at least one 25bp hike cumulatively priced over the coming months.
- The Bloomberg survey shows 6 of 23 analysts looking for no change from the BoC this week, although we'd caution that three are from June, one of which is Goldman Sachs who we know have since called for a hike. Notably, there appears to be broad consensus that this could be the final hike, but data dependency could easily put pay to that.
- In contrast, Bloomberg consensus is unanimous in expecting a no-change outcome for the RBNZ after it steered the market in its May Monetary Policy Statement towards no further increases in the OCR would be required. A 13% chance of a 25bp hike is priced for tomorrow's policy meeting. However, it is important to note that terminal OCR expectations have shifted 10-15bp firmer since last week and currently sit just shy of 5.80%.
- RBA-dated OIS pricing attaches a 58% chance of a 25bp hike at the August meeting.
- July 26 FOMC pricing currently gives a 25bp hike a 93% chance with the implied change of +23bp to 5.305%.
Figure 1: $-Bloc STIR
Source: MNI – Market News / Bloomberg
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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