SONIA Futures Bid, Aided By Soft AHE Data And Wider Bond Uptick

The uptick seen in core global FI markets since yesterday’s SONIA settlement, coupled with the softer-than-expected round of domestic AHE data fleshed out earlier, provide support for the strip early today.

• That leaves futures running 0.5-11bp firmer across the curve, although today’s labour market data was generally softer than expected (pointing to a continued loosening of the labour market) it isn’t seen as a gamechanger for tomorrow's BoE decision, as we covered earlier.
• BoE-dated OIS is little changed to ~9.5bp softer through contracts covering ’24 MPC meetings.
• Looking ahead, tomorrow’s run of monthly economic activity data provides the last meaningful pre-BoE data input, but that shouldn’t move the needle too much for policymakers, at least when it comes to Thursday's actual decision.