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Modest Dovish Moves In SONIA As Crude & Stocks Pressured, 50bp Of ’24 BoE Cuts Priced

STIR

SONIA futures generally edge higher as European equities and crude oil soften, last flat to +3.0.

  • BoE-dated OIS is little changed to ~3bp more dovish through mid-25, showing 11bp of cuts for Aug and 50.5bp of easing through year end.
  • Despite the optimism surrounding political stability, the latest BBG survey suggests that “UK economists are sceptical about the ability of Keir Starmer’s Labour government to turbo-charge growth, anticipating the slow expansion that blighted much of the past decade will continue.”
  • Focus remains on tomorrow’s UK CPI data and Thursday’s labour market report. Our preview of those data releases will cross later today.
  • The King’s Speech is also due on Wednesday, we provided greater colour on that event in our Gilt Week Ahead.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Aug-245.089-11.1
Sep-244.989-21.1
Nov-244.811-38.9
Dec-244.695-50.5
Feb-254.540-66.0
Mar-254.431-76.9
May-254.292-90.8
Jun-254.193-100.7
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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