Free Trial

GBP STIRs Also Stabilise, A Little Over 40bp Of '24 BoE Cuts Priced

STIR

SONIA markets also stabilise as Bunds edge higher, with futures -0.5 to +1.5.

  • BoE-dated OIS shows a little over 40bp of cuts through '24, with the first 25bp cut fully discounted through the September MPC meeting.
  • Local headline flow has been limited since yesterday’s close, leaving focus on dovish ECB speak and the broader market reaction to the latest BoJ policy decision.
  • The UK calendar is very limited into the weekend, which will leave focus on cross-market moves and macro headlines.
  • Pricing of BoE cuts operates at the shallower end of the recent range, with feedthrough from Fed pricing continuing to have a meaningful impact. Comments from BoE leadership (Bailey & Ramsden) have been more dovish than recent offerings from Greene & Pill, perhaps pointing to the potential for some divergence from Fed policy as ’24 develops.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
May-245.204+0.5
Jun-245.126-7.4
Aug-245.004-19.5
Sep-244.941-25.8
Nov-244.840-35.9
Dec-244.779-42.0
168 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.

SONIA markets also stabilise as Bunds edge higher, with futures -0.5 to +1.5.

  • BoE-dated OIS shows a little over 40bp of cuts through '24, with the first 25bp cut fully discounted through the September MPC meeting.
  • Local headline flow has been limited since yesterday’s close, leaving focus on dovish ECB speak and the broader market reaction to the latest BoJ policy decision.
  • The UK calendar is very limited into the weekend, which will leave focus on cross-market moves and macro headlines.
  • Pricing of BoE cuts operates at the shallower end of the recent range, with feedthrough from Fed pricing continuing to have a meaningful impact. Comments from BoE leadership (Bailey & Ramsden) have been more dovish than recent offerings from Greene & Pill, perhaps pointing to the potential for some divergence from Fed policy as ’24 develops.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
May-245.204+0.5
Jun-245.126-7.4
Aug-245.004-19.5
Sep-244.941-25.8
Nov-244.840-35.9
Dec-244.779-42.0