STIR futures are on the front foot this........>

STIR: STIR futures are on the front foot this morning, with the Eurodollar strip

the biggest mover. Outside of White most of the Eurodollar strip is up 2-3.5

ticks with the biggest moves seen in the M1-M2 area of the curve. There has been

focus on the GC rate in the US after it spiked higher yesterday. We will be

watching the fed funds rate closely. In the past if it has exceeded the top of

the target range, the Fed has cut the IOER more than the Fed funds target rate.

This is not something that had been discussed in any Fed sell-side previews.

- The short sterling and Euribor strips have also been dragged higher with Reds,

Greens and Blues up 1-2 ticks and White seeing smaller moves. There has been

little significant data of note released in Europe this morning, with the German

ZEW the only release, which saw the expectations component reverse yesterday's

fall. We do not read too much into the ZEW due to concerns about the

methodology, however.