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STIR: BoE-Dated OIS Still Pricing Over 55bp Of Cuts Through Dec, Ramsden Due Fri

STIR
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Little net movement in GBP STIRs today, with BoE-dated OIS continuing to price a little over 55bp of cuts through year-end.

  • Focus moves to BoE Deputy Governor Ramsden’s early Friday comments (07:00 GMT).
  • We have suggested that this may provide the most interesting domestic development of the week.
  • A reminder that Ramsden voted in favour of the enacted cuts in August, November and February. He also dissented in favour of a sequential 25bp cut in December and favoured an earlier first cut (first voting for 25bp cuts in May and June).
  • His previous speeches have been quite focused on how wage growth impacts services inflation but we haven't heard directly from him since the BoE Agents' Pay Survey pointed to 3.7% pay growth in 2025 (the last time he spoke the early indications of the survey were pointing to 2-4% before being narrowed to 3-4% in December).
  • It would be a surprise if he did not vote for sequential cuts in the near-term, after voting for a December cut.
  • We will be watching his Friday speech for any change in tone, as well as any indication on where he estimates the neutral rate to be.

BoE Meeting

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Little net movement in GBP STIRs today, with BoE-dated OIS continuing to price a little over 55bp of cuts through year-end.

  • Focus moves to BoE Deputy Governor Ramsden’s early Friday comments (07:00 GMT).
  • We have suggested that this may provide the most interesting domestic development of the week.
  • A reminder that Ramsden voted in favour of the enacted cuts in August, November and February. He also dissented in favour of a sequential 25bp cut in December and favoured an earlier first cut (first voting for 25bp cuts in May and June).
  • His previous speeches have been quite focused on how wage growth impacts services inflation but we haven't heard directly from him since the BoE Agents' Pay Survey pointed to 3.7% pay growth in 2025 (the last time he spoke the early indications of the survey were pointing to 2-4% before being narrowed to 3-4% in December).
  • It would be a surprise if he did not vote for sequential cuts in the near-term, after voting for a December cut.
  • We will be watching his Friday speech for any change in tone, as well as any indication on where he estimates the neutral rate to be.

BoE Meeting

Keep reading...Show less