FREELAND: CANADA WON'T ESCALATE OR BACK DOWN ON US TRADE FIGHT

MNI: PBOC To Aim To Drive Inflation Higher- Advisors

MNI: China To Issue More Bonds As Stimulus Targets Consumption

MNI: PBOC To Aim To Drive Inflation Higher- Advisors

MNI: China To Issue More Bonds As Stimulus Targets Consumption

MNI BRIEF: China Nov M1 Decline Narrows, M2 Slows

EZ/UK T-Bill Calendar: 8/13/28/50-Week BTF Auction on Monday

EZ/UK Bond Supply Calendar: 4.125% Jul-29 Gilt Due on Tuesday

MNI: CANADA OCT WHOLESALE SALES +3.3%; EX-AUTOS +0.5%

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

GILTS: Early Rally Fades, Long End Swap Spreads Tighten

GILTS
CEEMEABulletUKGlobalFixed Income BulletsRegionMarkets

Early gains more than reversed, with spill over from weakness in Bunds applying pressure.

  • A U.S. Tsy rally following the narrowing of U.S. election odds provided support at the open.
  • That was before signs of German political/fiscal uncertainty weighed on Bunds.
  • Uptick in crude oil futures provides another headwind.
  • Futures last -19 at 93.75, just above session lows of 93.70.
  • Contract sticks comfortably within Friday’s range.
  • Bearish technicals remain intact. First support at Thursday’s low (93.18).
  • Yields now 1.5-3.5bp higher on the day, curve steeper.
  • Swap spreads flat to ~1bp tighter to start the week, with the supply outlook limiting any rallies.
  • 5-, 10- & 30-Year swap spreads on track to set fresh closing cycle lows at current levels.
  • The DMO will outline its agenda for the FQ4 (Jan-Mar) investor/GEMM consultation at 15:30. We set out our expectations for the gilts on offer on pages 5-7 of our Budget Review.
  • Focus also on cross-market flows into the U.S. election and any further fiscal-related headlines.
  • BoE-dated OIS flat to 4bp more hawkish on the day.
  • 22bp of cuts priced for next week, 29.5bp showing through year-end, 57bp through March and 76bp through June.
  • SONIA futures flat to -2.0.
  • BoE decision due Thursday, all 54 surveyed by BBG look for a 25bp cut. BMO the only name looking for no change (that we have seen).
208 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.

Early gains more than reversed, with spill over from weakness in Bunds applying pressure.

  • A U.S. Tsy rally following the narrowing of U.S. election odds provided support at the open.
  • That was before signs of German political/fiscal uncertainty weighed on Bunds.
  • Uptick in crude oil futures provides another headwind.
  • Futures last -19 at 93.75, just above session lows of 93.70.
  • Contract sticks comfortably within Friday’s range.
  • Bearish technicals remain intact. First support at Thursday’s low (93.18).
  • Yields now 1.5-3.5bp higher on the day, curve steeper.
  • Swap spreads flat to ~1bp tighter to start the week, with the supply outlook limiting any rallies.
  • 5-, 10- & 30-Year swap spreads on track to set fresh closing cycle lows at current levels.
  • The DMO will outline its agenda for the FQ4 (Jan-Mar) investor/GEMM consultation at 15:30. We set out our expectations for the gilts on offer on pages 5-7 of our Budget Review.
  • Focus also on cross-market flows into the U.S. election and any further fiscal-related headlines.
  • BoE-dated OIS flat to 4bp more hawkish on the day.
  • 22bp of cuts priced for next week, 29.5bp showing through year-end, 57bp through March and 76bp through June.
  • SONIA futures flat to -2.0.
  • BoE decision due Thursday, all 54 surveyed by BBG look for a 25bp cut. BMO the only name looking for no change (that we have seen).