Early Rally Extends

Gilt futures clear 98.00 (highs of 98.06 so far), with bulls eying the May 10 high of 98.29.

• Cash gilt yields are 4.5-5.5bp lower across the curve, although none of the major benchmarks have tested their early May lows as of yet.
• Catch up to the late NY extension of yesterday’s rally in U.S. Tsys and a focus on deeper policy support out of China play into the early London bid.
• Most SONIA futures also tick higher as well, last flat to +4.0.
• BoE-dated OIS moves to price ~57bp of cuts through year end, with ~13bp of easing priced through the June MPC.
• Both those metrics stick within recent ranges following the post-MPC dovish repricing seen in recent sessions.