Firmer To Start The Week, Long End Syndication & Flash PMIs Due In Coming Days

Gilt futures firm in early Monday trade given the rally in Bund & Tsy equivalents since Friday’s gilt close (although do note that the latter is comfortably shy of Asia-Pac highs), before moving back from best levels.

• The contract sits +15 or so at typing, around 98.95, ~20 ticks shy of the peak of its early 28-tick range.
• Friday’s high is unchallenged/intact.
• Cash gilts are 1bp higher to 3bp lower in yield terms, with the curve twist flattening.
• SONIA futures show -2.0 to +2.0 through the blues, with the uptick in gilts providing some support after some pre-gilt open weakness.
• BoE-dated OIS also sees some light receiver-side flow, with ~106.5bp of cuts now priced through ‘24 vs. 104.5bp pre-gilt open.
• Note there will be nothing in the way of APF sales from the BoE today.
• A reminder that the DMO is set to issue a new 30-year 4.375% Jul-54 gilt via syndication at some point this week, we believe that will likely come on Tuesday. The gap in APF sales can probably be explained by the presence of this syndication.
• The highlight of this week’s domestic data docket comes via Wednesday’s flash PMIs.