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STIR: BOJ Dated OIS Gives Little Chance Of A Hike Tomorrow

STIR
BulletMarketsFixed Income Bullets

Ahead of tomorrow’s BOJ policy decision, BOJ-dated OIS pricing continues to hold firmer across meetings versus levels prevailing ahead of the October 30-31 meeting. 

  • Currently, OIS pricing sits flat to 12bps firmer across meetings versus pre-BOJ MPM (Oct), with September 2025 leading the gains.
  • For tomorrow’s decision, pricing is flat versus late October, reflecting only a 14% probability of a 25bp rate hike. Pricing for this meeting has softened from a 50:50 chance in early December.
  • Market expectations currently indicate: a 14% probability of a 25bp hike in December; a cumulative 54% chance by January; and a full 25bp increase is not fully priced in until May 2025.

 

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Ahead of tomorrow’s BOJ policy decision, BOJ-dated OIS pricing continues to hold firmer across meetings versus levels prevailing ahead of the October 30-31 meeting. 

  • Currently, OIS pricing sits flat to 12bps firmer across meetings versus pre-BOJ MPM (Oct), with September 2025 leading the gains.
  • For tomorrow’s decision, pricing is flat versus late October, reflecting only a 14% probability of a 25bp rate hike. Pricing for this meeting has softened from a 50:50 chance in early December.
  • Market expectations currently indicate: a 14% probability of a 25bp hike in December; a cumulative 54% chance by January; and a full 25bp increase is not fully priced in until May 2025.

 

Keep reading...Show less