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Modest Hawkish Moves Reverse On U.S. Data

STIR

SONIA markets also see a dovish adjustment in the wake of the U.S. data.

  • This morning’s modest hawkish move reverses.
  • BoE-dated OIS contracts are now little changed to 1bp more dovish on the day.
  • ~14.5bp of cuts are priced for the August meeting, while ~43bp of cuts are showing through year end.
  • SONIA futures are flat to +1.0.
  • Final Q1 UK GDP data is due tomorrow, but that shouldn’t be a major market mover.
  • More focus is set to fall on spill over from European national CPI and U.S. PCE data.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Aug-245.054-14.6
Sep-244.996-20.4
Nov-244.861-33.9
Dec-244.769-43.1
Feb-254.635-56.5
Mar-254.547-65.3
May-254.429-77.1
Jun-254.344-85.6
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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