SONIA Showing Just Under 50bp Of BoE Cuts For '24

GBP STIRs drift further away from post-BoE dovish extremes alongside the downtick in wider core global FI markets.

• BoE-dated OIS failed to show more than 50bp of ’24 cuts during the post-BoE dovish adjustment, with ~48bp of cuts priced through year end at typing.
• Pricing for the August MPC currently shows ~56% odds of a cut, while Sep MPC pricing shows ~90% odds of a cut through that juncture, little changed vs. levels seen in the aftermath of today’s dovish BoE outcome.
• SONIA futures last +1.0 to +6.5 through the blues.
• SFIZ4 failed to close its May 22 gap lower.
• SFIZ5 breached its May highs before fading back below.
• SFIZ6 failed to challenge March highs.
• Markets will be attentive to post-election BoE rhetoric, looking for clues for trigger points to greenlight cuts from any of the MPC voters that were close to voting for a cut today (if they reveal themselves).
• Flash PMI data and retail sales headline the UK calendar tomorrow.