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GILTS: Firmer As Global Growth Risks Dominate

GILTS
CEEMEABulletUKMarketsFixed Income Bullets

Gilts have rallied this morning, with weakness in crude oil, soft retail sales data out of China and further global growth headwinds in the form of the details of the flash PMI data driving the move.

  • UK PMI data also provided some inflationary worry, resulting in a knee-jerk, limited hawkish move that faded.
  • Futures as high as 94.50, last +13 at 94.45, moving away from Friday’s late low.
  • Technically, futures traded sharply lower last week, resulting in a move through support at 95.49, the Dec 4 low, and 95.17, the Nov 28 low.
  • A continuation lower would expose key support at 93.40, the Nov 18 low.
  • Key resistance and the bull trigger at 96.54, the Dec 3 high. Initial resistance is at 95.16, the 20-day EMA.
  • Yields 2-3bp lower, long end outperforms at the margin.
  • 10s outperform Bunds by 1bp, spread sticks to multi-week range, last 214bp.
  • SONIA futures -0.5 to +3.5.
  • BoE-dated OIS shows 0.5bp of easing for Thursday, 20bp of cuts through February, 28bp through March and 78bp through December ’25, little changed to 2.5bp more dovish on the day.
  • UK inflation & labour market data will set the tone ahead of Thursday’s BoE decision. Our preview of the data will cross later today, with our BoE preview set to be released tomorrow.
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Gilts have rallied this morning, with weakness in crude oil, soft retail sales data out of China and further global growth headwinds in the form of the details of the flash PMI data driving the move.

  • UK PMI data also provided some inflationary worry, resulting in a knee-jerk, limited hawkish move that faded.
  • Futures as high as 94.50, last +13 at 94.45, moving away from Friday’s late low.
  • Technically, futures traded sharply lower last week, resulting in a move through support at 95.49, the Dec 4 low, and 95.17, the Nov 28 low.
  • A continuation lower would expose key support at 93.40, the Nov 18 low.
  • Key resistance and the bull trigger at 96.54, the Dec 3 high. Initial resistance is at 95.16, the 20-day EMA.
  • Yields 2-3bp lower, long end outperforms at the margin.
  • 10s outperform Bunds by 1bp, spread sticks to multi-week range, last 214bp.
  • SONIA futures -0.5 to +3.5.
  • BoE-dated OIS shows 0.5bp of easing for Thursday, 20bp of cuts through February, 28bp through March and 78bp through December ’25, little changed to 2.5bp more dovish on the day.
  • UK inflation & labour market data will set the tone ahead of Thursday’s BoE decision. Our preview of the data will cross later today, with our BoE preview set to be released tomorrow.