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BoE Pricing Sees Modest Dovish Tilt Early On Friday

STIR

SONIA futures are -0.5 to +1.0 through the blues, with little in the way of meaningful macro news flow observed and Bunds ticking away from worst levels of the day.

  • BoE-dated OIS is little changed to marginally more dovish across ’24 meeting contracts. ~153bp of cuts are showing through ’24, with the first 25bp cut more than fully discounted come the end of the May ’24 MPC gathering.
  • Domestic news flow saw the latest KPMG survey point to consumer worries surrounding financial security, which could impact spending habits in ’24.
  • On that front, the latest data from Barclaycard pointed to fairly tepid UK card spending growth when the impact of inflation is netted off.
  • Still, the latest BBG survey, released yesterday, points to expectations for the UK economy to avoid a ‘hard landing.’
  • A quick reminder that the major SONIA markets will close at 12:15 (London) today.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Feb-245.193+0.7
Mar-245.105-8.1
May-244.887-29.9
Jun-244.620-56.6
Aug-244.319-86.8
Sep-244.066-112.0
Nov-243.816-137.0
Dec-243.655-153.1
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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