Bulls Fail To Sustainably Breach 101.00 On First Test

Futures failed to push meaningfully above 101.00 in the wake of the U.S. NFP data, topping out at 101.03 before easing back to trade 100.85 last.

• Bulls will want to force a close above 101.00 to further solidify the recent upside move.
• Cash gilt yields are 7-11bp lower across the curve, bull steepening theme intact.
• SONIA futures 0.25-12bp firmer through the blues, with most contracts comfortably off U.S. data-driven highs.
• General post-decision BoE commentary has guided towards a gradualist approach when it comes to further cuts, with a focus on the likelihood of some economic slack developing and the Bank’s inclusion of skew in the forecasts introducing greater uncertainty
• This has limited the BoE-dated OIS strip to pricing ~9bp of cuts for the September meeting, although 31bp of cumulative cuts are priced come the end of the November meeting.