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Gilt Week Ahead: Pill, Bailey, GDP due; markets eye more hikes

  • In our Bank of England review, we noted the new “hybrid” guidance provided by the Bank – combining the “modest tightening” language of Aug/Sep/Dec would be required in the “coming months”
  • The MNI Markets team continues to look for 25bp hikes in both March and May, but we think that market is carried away here and market pricing is overdone for 2022 as a whole.
  • This week we are due to hear again from BOE Chief Economist Pill and Governor Bailey. It will be interesting to see if either member addresses the moves in markets since the MPC decision directly, or if they continue to point to inflation undershooting target if Bank Rate is 1.50%, citing the forecasts.
  • The only top tier data release this week will be the release of GDP and its components on Friday while the week ahead also sees the syndicated launch of the new 50-year 1.125% Oct-73 gilt.
  • See the full document for gilt supply previews for the week ahead, QE tracker and BOE purchase analysis, cash flow matrix and issuance calendar.
Full document:

GiltWeekAhead220207.pdf

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