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SONIA Holds Late Wednesday Moves, Local Survey Data Eyed

STIR

SONIA futures generally hold their post-settlement rally, unchanged to +3.5 through the blues after wider core global FI markets rallied a little on Fed Chair Powell’s late Wednesday comments.

  • BoE-dated OIS contracts are also in line with late Wednesday levels, showing ~71.5bp of cuts through year end. Further forward, ~17.5bp of cuts are priced through the June MPC, with recent ranges intact.
  • The BoE DMP survey headlines the UK calendar today.
  • The wage and inflation components will continue to receive the most interest, given feedthrough into BoE policy.
  • Final services PMI data is also due.
  • Those with a dovish leaning may use any hawkish reaction to those surveys to enter received/flattener positions, particularly if we get closer to range extremes.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
May-245.155-4.0
Jun-245.022-17.4
Aug-244.870-32.6
Sep-244.752-44.4
Nov-244.602-59.4
Dec-244.481-71.5
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SONIA futures generally hold their post-settlement rally, unchanged to +3.5 through the blues after wider core global FI markets rallied a little on Fed Chair Powell’s late Wednesday comments.

  • BoE-dated OIS contracts are also in line with late Wednesday levels, showing ~71.5bp of cuts through year end. Further forward, ~17.5bp of cuts are priced through the June MPC, with recent ranges intact.
  • The BoE DMP survey headlines the UK calendar today.
  • The wage and inflation components will continue to receive the most interest, given feedthrough into BoE policy.
  • Final services PMI data is also due.
  • Those with a dovish leaning may use any hawkish reaction to those surveys to enter received/flattener positions, particularly if we get closer to range extremes.
BoE MeetingSONIA BoE-Dated OIS (%)Difference Vs. Current Effective SONIA Rate (bp)
May-245.155-4.0
Jun-245.022-17.4
Aug-244.870-32.6
Sep-244.752-44.4
Nov-244.602-59.4
Dec-244.481-71.5