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BoE Terminal Pricing Tops 6.40%

STIR

BoE-dated OIS terminal policy rate pricing breaches 6.40%, breaking the mini-Budget high in the process. ~45bp of tightening is priced for the Bank's August gathering, little changed on the day. We haven't seen much in the way of meaningful headline flow to drive the steepening of the strip. There has been BBG source-based speculation surrounding BoE Deputy Governor succession, although that wouldn't have moved the needle. Once again we flag the lack of overt triggers re: receiver-side flows and limited desire/ability to warehouse any such risk in light of recent fundamental news flow (as well as the lack of clear BoE guidance re: policy rate trajectory) when it comes to facilitating the direction of travel.

MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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