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Strong Rally From Lows

GILTS

An aggressive rally for gilts in the wake of today’s U.S. data.

  • •The UK FI rally seems to be totally driven by external factors.
  • •Futures move to fresh session highs of 97.97, after registering a low of 96.83 this morning.
  • •Initial support levels were breached as the bearish move extended, but previously flagged futures and yield support levels from late ’23 were untouched.
  • •Bulls need to overcome the Feb 26 high (98.53) to start turning the tide more in their favour.
  • •Cash gilt yields are 4-6bp lower across the curve, bull flattening after bear flattening this morning.
  • •10+-Year gilt yields hit fresh ’24 highs during the sell off.
  • •SONIA futures rally alongside gilts, last flat +4.0. Greens ~15bp off lows.
  • •BoE-dated OIS shows ~63.5bp of cuts through ’24, after nearing 50bp earlier today.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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