Modest Downtick In SONIA Futures, A Little Under 55bp Of '24 BoE Cuts Priced

GBP STIRs factor in the pullback from yesterday’s highs in core global FI markets at the open.

• SONIA futures are flat to 2bp lower through the blues.
• ’24 BoE-dated OIS contracts print little changed to 1.5bp firmer on the day, leaving ~53.5bp of cuts priced through year end and just over 90% odds of a 25bp cut come the end of the Aug MPC.
• Discussions continue to centre on tomorrow’s BoE decision.
• The 3 focus areas surrounding the decision will be the vote split, the economic projections and the guidance. Our full preview of the event and thoughts on those factors can be found here.
• The Times shadow MPC has suggested that “the BoE should leave interest rates unchanged at its meeting on Thursday but consider loosening policy at its next gathering in June if inflation and wages continue to ease.”
• The S&P/KPMG/REC report on jobs and RICS house price data will cross just after midnight, but there isn’t anything in the way of meaningful UK releases scheduled before the close.
• That is likely to leave cross-market spill over and any remaining pre-BoE positioning at the fore.