April 19, 2024 06:44 GMT
Light Dovish Move In SONIA Futures Following Israeli Reaction
STIR
A contained reaction to overnight events surrounding Iran & Israel for SONIA futures, with contracts little changed to +2.5 through the reds.
- BoE-dated OIS shows ~45bp of cuts through year end, vs ~42bp late yesterday.
- To recap, Iran has suggested that the Israeli response to its recent missile attack was tame (possibly completely ineffective).
- Meanwhile, there was no apparent damage to Iranian nuclear sites.
- That combination has allowed core global FI markets to move away from knee-jerk Asia highs that came on the back of the news re: the counter offensive.
- Domestically, retail sales data was softer than expected, with marginal positive revisions to the prior month. Retail sales are expected to have a small positive impact on Q1 GDP.
- Looking ahead, comments from BoE’s Ramsden & Mann headline the domestic calendar today.
- Geopolitical headline flow will receive heightened interest given overnight events.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference Vs. Current Effective SONIA Rate (bp) |
May-24 | 5.196 | -0.2 |
Jun-24 | 5.116 | -8.3 |
Aug-24 | 5.008 | -19.0 |
Sep-24 | 4.932 | -26.6 |
Nov-24 | 4.826 | -37.3 |
Dec-24 | 4.753 | -44.6 |
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