Sharply Lower Alongside Global Core FI

Little in the way of domestic drivers to separate Gilts from core FI peers, with the ongoing UST selloff remaining at the fore. The latest US job openings data has helped futures off lows, but moves have been limited overall.

• Gilt futures are 157 ticks lower at 98.37 at typing. The breach of the 20-day EMA at 99.04 this morning has exposed the key support at 98.05 (March 15 low). A break of this level would strengthen a bearish theme.
• The cash curve has bear steepened, with yields 8bps to 15bps lower and the 2s10s curve 8.1bps steeper today, trading at its steepest since the start of March.
• BoE-dated OIS contracts price 70bps of cuts through the remainder of '24 (vs 71bps this morning) and 30bps through the end of the August meeting (steady vs this morning).
• SONIA futures are flat to -17.0 ticks lower through the blues.
• Today's domestic data were not meaningful market movers. Lower than expected BRC Shop Price Index and Nationwide House Price index data before the Gilt open did little to counter the bearish momentum, while the March manufacturing PMI was revised a touch higher to above 50 for the first time since July 2022.
• This morning also saw mortgage approvals data come in over 60k for February (the highest since September 2022) with net lending secured on dwellings increasing GBP1.5bln in February (the highest since January 2023). However, net consumer credit data was a bit on the softer side of expectations.
• Tomorrow's domestic calendar is very light, before the BoE Decision Maker Panel and final services PMIs are released Thursday.