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SONIA Futures Rally On French Political Uncertainty, Nearly 45bp Of ’24 BoE Cuts Priced

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HomepageBank Of England (BOE) Market NewsBulletMarketsFixed Income BulletsForeign Exchange Bullets

SONIA futures are flat to +8.5, at/just off session highs, with the French political situation dominating another session.

  • BoE-dated OIS moves to price ~44bp of cuts through year end vs. ~42bp late yesterday.
  • Market implied probabilities point to ~80% odds of a 25bp cut come the end of the Sep MPC.
  • Domestically, political headwinds remain evident for PM Sunak, with the Conservative party slipping behind the Reform UK party in the latest YouGov poll, in another first for British politics.
  • The BoE-Ipsos inflation attitudes survey headlines the UK calendar ahead of the weekend (due imminently, at 09:30 London), although cross-market matters are set to receive as much, if not more, interest.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Jun-245.201+0.1
Aug-245.087-11.3
Sep-244.998-20.2
Nov-244.863-33.7
Dec-244.761-43.9
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SONIA futures are flat to +8.5, at/just off session highs, with the French political situation dominating another session.

  • BoE-dated OIS moves to price ~44bp of cuts through year end vs. ~42bp late yesterday.
  • Market implied probabilities point to ~80% odds of a 25bp cut come the end of the Sep MPC.
  • Domestically, political headwinds remain evident for PM Sunak, with the Conservative party slipping behind the Reform UK party in the latest YouGov poll, in another first for British politics.
  • The BoE-Ipsos inflation attitudes survey headlines the UK calendar ahead of the weekend (due imminently, at 09:30 London), although cross-market matters are set to receive as much, if not more, interest.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
Jun-245.201+0.1
Aug-245.087-11.3
Sep-244.998-20.2
Nov-244.863-33.7
Dec-244.761-43.9