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BoE Pricing Little Changed, Greater Than Even Odds Of Cut Still Priced For Aug

STIR

SONIA futures are 0.5 to 1.5 lower, with Bunds off overnight highs and a touch below levels seen at yesterday’s SONIA settlement window.

  • BoE-dated OIS sticks to familiar territory, showing ~13.5bp of cuts for August and a cumulative ~41.5bp of easing through year end.
  • Several final opinion polls point to a record majority for Labour, with the degree of that majority set to be the defining factor when it comes to Friday’s initial post-election reaction.
  • Final services and composite PMI readings headline today’s UK calendar. That shouldn’t be a meaningful market mover, leaving leave focus on wider macro matters e.g. the ECB’s Sintra forum and U.S. data.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Aug-245.067-13.3
Sep-245.004-19.6
Nov-244.871-32.9
Dec-244.787-41.4
Feb-254.661-53.9
Mar-254.578-62.2
May-254.463-73.7
Jun-254.386-81.4
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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