GILTS: Slight Outperformance Vs. Bunds, BoE's Ramsden Eyed Later

Gilts continue to stick to narrow ranges, adjusting to the late Friday bid in wider core global FI markets and spill over from today’s dovish tweak in China’s monetary policy stance. 

• Futures +22 at 95.88, within Friday’s range.
• Initial support/resistance at 95.49/96.18.
• Bullish corrective cycle in the contract remains in play.
• Yields 0.5-1.5bp lower.
• 10s 1bp tighter vs. Bunds. Spread last 215.5bp, 220bp continuing to cap, while relative fundamentals limit pullbacks.
• SONIA futures flat to +4.5, little changed vs. pre-open levels.
• BoE-dated OIS showing 82bp of cuts through Dec ’25, 21bp of easing priced through Feb, 29bp through March, flat to 2bp more dovish on day.
• The KPMG-REC Report on Jobs provided the latest downbeat assessment of the labour market.
• Looking ahead, BoE Deputy Governor Ramsden will speak on "Financial stability and the Bank of England’s toolkit" (13:00 London).
• The speech itself is unlikely to be a market mover but the Q&A will be watched for any deviation from Ramsden's view that case 2 (gradual cuts required) is most likely, with risks skewed towards case 1 (requiring faster cuts).
• He last spoke on 20 November so it’s unlikely his view will have substantially changed.
• Elsewhere, the has FT reported that the EU is drawing up tough red lines for its "reset" negotiations with the UK, with Chancellor Reeves attending today’s Eurogroup meeting.