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BoE Pricing Eases A Little, Pill Wary Of Overtightening

STIR

BoE-dated OIS eases today, likely looking to the moves in European equivalents and comments from BoE’s Pill, who reiterated his preference for holding rates higher for longer, as opposed to running the risk of overtightening (albeit with a clear eye on inflationary risk).

  • Liquid contracts on the BoE-dated OIS strip run 1-5bp softer on the day.
  • That leaves ~26bp of tightening showing for September, while terminal policy rate pricing hovers around 5.85%.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Sep-235.447+26.2
Nov-235.612+42.7
Dec-235.719+53.4
Feb-245.770+58.4
Mar-245.771+58.5
May-245.740+55.4
Jun-245.690+50.5
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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