OI Indicates ECB Pushback On Rate Cut Pricing Triggered Short Setting Across Most Of Strip

The combination of yesterday’s weakness on the Euribor strip and OI data points to net short setting as the dominant positioning theme as the new week got underway.

• Pockets of long cover were seen through the greens, but the whites, reds and greens were dominated by apparent short setting.
• The blues saw little change in net pack OI, with a very modest bias to apparent long cover (small net OI swings were seen in all of the individual contracts).
• A quick reminder that what seemed to be pre-meeting pushback from across the ECB dove-hawk spectrum provided the bulk of the impetus for the relatively contained move lower in Euribor futures on Monday. There has been a bit of a continuation in that line of rhetoric today, albeit a little more watered down (the ECB's pre-meeting blackout period goes into play later this week).