Holding Lower, BoE Speak & CPI Eyed after Hot Wage Data

This mornings’ firmer-than-expected wage data keeps the pressure on gilts, with futures registering fresh lows in recent trade (96.44), moving closer to the next technical support level (96.30) in the process.

• Cash gilt yields are 2.0-3.5bp higher across the curve.
• 2s test April yield highs, while 10s register fresh year-to-date yield highs, with the latter now eying the Nov 24 high (4.323%).
• 10s closed above their 200-DMA yesterday, representing the first such close since December.
• Nov-33 I/L gilt supply was well received.
• SONIA futures are flat to 6.0 lower, just off session lows.
• BoE-dated OIS shows ~47bp of ’24 cuts vs. a little over 50bp late Monday. The first 25bp is still fully discounted come the end of the September MPC.
• Immediate focus moves to impending comments from incoming BoE Deputy Governor Lombardelli, with comments from Governor Bailey due later on Tuesday (click for more on both addresses).
• Data-wise, the next release of note comes in the form of tomorrow’s CPI data, with a particular focus on services inflation and the ‘Easter impact.’
• Click for our full preview of that release.