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Greater Than Even Odds Of An Aug BoE Cut Still Priced

STIR

SONIA futures are flat to +2.0, while BoE-dated OIS is little changed to 1.5bp more dovish, showing ~14bp of cuts for the August MPC and ~42bp of easing through year end.

  • BRC shop price index data showed the shallowest Y/Y rise since late ’21, +0.2%.
  • Still, the report noted that “the latest results reveal a slowdown in consumer optimism compared to recent months.” The post-election trajectory in confidence will be worth watching.
  • There is little of note on the UK calendar today, outside of gilt supply.
  • That will likely leave cross-market moves and election matters at the centre of discussions.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Aug-245.062-13.8
Sep-245.004-19.7
Nov-244.870-33.0
Dec-244.782-41.8
Feb-254.657-54.3
Mar-254.575-62.5
May-254.460-74.0
Jun-254.381-81.9
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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