/STIR: GBP STIRs Show Near 50/50 Odds Of June Cut

Spill over from the U.S. weekly jobless claims data pushes gilt futures back towards session highs before the move falters.

• The contract remains rangebound, while only 2- & 5-Year yields managed to register fresh multi-week lows post-BoE.
• The BoE outcome reads a little dovish all told, with the vote split, inflation projections and Bailey’s choice to point to the potential for a swifter cutting cycle than markets currently discount providing the main points of discussion.
• BoE-dated OIS now prices 13bp of easing through the June meeting (just over 50/50 odds of a 25bp cut), providing scope for plenty of opportunities around UK data releases.
• This is particularly true as Bailey reaffirmed that the Bank holds no preconceptions about the policy rate path as he stressed the importance of the incoming data.
• ~59bp of cuts are priced through ’24 vs. closer to ~54bp pre-decision.