Limited Moves In BoE Pricing Alongside Latest Bond Rally

The broader bid in core global FI markets helps underpin SONIA futures, but bulls can’t muster a meaningful extension of the early rally, leaving contracts flat to +6.5.

• BoE-dated OIS shows 36.5bp of cuts through year end, for a less than 1bp net move on the day.
• The lack of BoE messaging since the July 4 election was announced (as is the norm), as well as the lingering impact of the firmer-than-expected April CPI data and impact of this year’s hawkish moves in the BoE implied policy rate path, are probably factoring into the lack of a rebound in the pricing of cuts at this juncture.
• U.S. JOLTS jobs data provides the next macro input, at 15:00 London.
• Local focus remains on political matters, with the initial Sunak-Starmer TV debate scheduled for 21:00 London time.
• The Conservatives still trail heavily in the opinion polls.