Little Movement In BoE Pricing, 12bp Of Cuts Priced For June, 53bp Of Cuts Through Year End

SONIA futures are flat to -1.0 through the blues, although Bunds are incrementally firmer than levels that prevailed during yesterday’s SONIA settlement window.

• The BoE-dated OIS strip is little changed across ’24 contracts, showing ~12bp of cuts for June and ~53bp of easing through year end. The strip has edged away from recent dovish extremes.
• Discussions/polling surrounding the post-election fiscal backdrop have been seen since yesterday’s close, but shouldn’t be a needle mover for markets.
• Lower tier UK CBI trends data is due today. That release headlines a very thin UK data calendar, which will likely leave focus on cross-market moves and broader macro headline flow/data.
• We are also due to hear from BoE Governor Bailey (18:00 London), as he gives a lecture at the LSE entitled “The importance of central bank reserves”.
• This may not give us too much guidance on monetary policy, but we will be watching closely for any potential discussion of the future path of QT (click for our UK Deep Dive, where we discussed the outlook for QT. We think that there is a good chance that active sales continue, but at a slower pace from October).