SONIA Futures Lower TO Start The Week, International & Domestic Matters Eyed

A combination of wider macro inputs and domestic matters seemingly helped SONIA futures lower to start the week, with contracts running flat to -4.0 through the blues. The space has recovered from early lows.

• BoE-dated OIS is 0.5-6.5bp firmer across '24 contracts, leaving ~89bp of cuts priced across '24 at typing.
• On the macro front, weekend comments from Fed Chair Powell (covered in detail elsewhere) and a hawkish BoJ sources piece in the FT have been noted.
• Moving to matters closer to home, the latest ONS update suggested that the labour market is a little tighter than was initially envisaged (covered in detail in an earlier bullet).
• Also note that a PWC survey has revealed that ~80% of UK businesses believe that high energy bills will result in them having to lift prices at some point over the next two years. That represents a slight uptick vs. related action over the last two years.
• Final services and composite PMIs provide the domestic data highlights during the remainder of the session, while another round of comments from BoE chief economist Pill are due to cross.