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STIR
BoE-dated OIS is a touch softer today, although the moves are contained (~4bp softer at most at typing), recording the biggest such move vs. yesterday’s closing levels amongst UK, EUR & U.S. central bank pricing.
- We suggested earlier that the UK rates curve should be better insulated from the cross-currents derived from yesterday’s BoC hike (which caught most off guard), purely based on the market’s assumption when it comes to the distance of travel before terminal rate levels are reached (which lies ~100bp from prevailing policy rate levels at present).
- Terminal rate pricing remains shy of the post-CPI hawkish extremes.
- A quick reminder that the local docket remains thin for the remainder of the week, with BoE speak and tier 1 UK economic data returning after the weekend.
| BoE Meeting | SONIA BoE-Dated OIS (%) | Difference Vs. Current Effective SONIA Rate (bp) |
| Jun-23 | 4.716 | +28.8 |
| Aug-23 | 5.014 | +58.6 |
| Sep-23 | 5.236 | +80.8 |
| Nov-23 | 5.396 | +96.8 |
| Dec-23 | 5.446 | +101.8 |
| Feb-24 | 5.441 | +101.3 |
| Mar-24 | 5.411 | +98.3 |
Source: MNI Market NEws- Bloomberg
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
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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