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BoE-Dated OIS Settles In Familiar Territory

STIR

BoE-dated OIS has settled around familiar levels, given the lack of meaningful domestic headline flow and nothing in the way of spill over surrounding lower tier domestic money and credit data. That leaves ~45bp of tightening priced for the August MPC (~90% chance of a follow up 50bp step) along with a terminal BoE policy rate of just below 6.25%.

  • A quick reminder that the Bank will only have one further set of inflation and labour market data to go off when it next sets monetary policy, which, when coupled with the relatively non-committal tone surrounding the future trajectory of its policy settings, has market participants heavily favouring another 50bp step in August.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Aug-235.380+45.2
Sep-235.758+83.0
Nov-236.021+109.3
Dec-236.152+122.4
Feb-246.169+124.1
Mar-246.148+122.0
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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