STIR: Euribor Off Overnight Lows But Still Weaker vs Settlement

Euribor futures are -4.0 to -8.5 ticks below yesterday’s settlement levels, after gapping lower alongside Bunds overnight as yesterday’s risk-off moves continued to unwind.

• Futures are off overnight lows at typing, and saw little reaction to the stronger-than-expected German June factory orders data (3.9% M/M vs 0.5% cons, -1.7% prior).
• The RBA delivered a “hawkish hold” overnight, and Governor Bullock’s press conference has just concluded. The market reaction in EUR rates was limited overall.
• ECB-dated OIS have moderated from the dovish extremes registered at yesterday’s open, with 25bps of easing priced through the September meeting and 71bps through the remainder of this year (versus a dovish extreme of over 90bps yesterday).
• Today’s regional calendar is light, leaving focus on broader cross-market matters.