MNI China Daily Summary: Wednesday, July 10

MNI BRIEF: China To Investigate EU Trade Actions

MNI BRIEF: China June CPI Hits Three Month Low

MNI: PBOC Conducts CNY2 Bln Via OMO Weds; Liquidity Unchanged

CHINA PBOC CONDUCTS CNY2 BILLION VIA 7-DAY REVERSE REPOS WEDS

MNI: PBOC Sets Yuan Parity Higher At 7.1342 Weds; -0.53% Y/Y

MNI JAPAN MAY CORE MACHINE ORDERS -3.2% M/M; APRIL -2.9%

EZ/UK T-Bill Calendar: 1/3/6-Month UKTB Auction on Friday

EZ/UK Bond Supply Calendar: Italy, UK Auction on Thursday

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

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Little Change In SONIA Markets, ~35bp Of '24 BoE Cuts Priced

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HomepageBank Of England (BOE) Market NewsBulletMarketsFixed Income BulletsForeign Exchange Bullets

SONIA futures are effectively unchanged through the blues, with Bund futures hovering around yesterday’s settlement levels

  • BoE-dated OIS shows ~35bp of cuts through ’24, with the first full 25bp cut priced through the end of the Nov MPC, little changed on the day.
  • A reminder that softer-than-expected U.S. data helped promote a dovish move on Monday.
  • Still, we stick to the hawkish end of the ’24 range, but ’24 & ’25 SONIA futures have stabilised.
  • UK headline flow continues to be dominated by political matters, ahead of today’s initial Sunak-Starmer TV debate.
  • Labour continues to hold a huge lead in the opinion polls, while Nigel Farage has announced his intentions to run for a seat, leading the Reform UK Party.
  • BRC like-for-like sales saw a much shallower than expected rebound in May.
  • There isn’t much in the way of scheduled UK risk events ahead of the debate flagged above (which will get underway at 21:00 London), which will likely leave focus on broader headline flow and cross-market spill over.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Jun-245.197-0.3
Aug-245.113-8.7
Sep-245.044-15.6
Nov-244.924-27.7
Dec-244.845-35.5
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SONIA futures are effectively unchanged through the blues, with Bund futures hovering around yesterday’s settlement levels

  • BoE-dated OIS shows ~35bp of cuts through ’24, with the first full 25bp cut priced through the end of the Nov MPC, little changed on the day.
  • A reminder that softer-than-expected U.S. data helped promote a dovish move on Monday.
  • Still, we stick to the hawkish end of the ’24 range, but ’24 & ’25 SONIA futures have stabilised.
  • UK headline flow continues to be dominated by political matters, ahead of today’s initial Sunak-Starmer TV debate.
  • Labour continues to hold a huge lead in the opinion polls, while Nigel Farage has announced his intentions to run for a seat, leading the Reform UK Party.
  • BRC like-for-like sales saw a much shallower than expected rebound in May.
  • There isn’t much in the way of scheduled UK risk events ahead of the debate flagged above (which will get underway at 21:00 London), which will likely leave focus on broader headline flow and cross-market spill over.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Jun-245.197-0.3
Aug-245.113-8.7
Sep-245.044-15.6
Nov-244.924-27.7
Dec-244.845-35.5