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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
STIR
Market expectations regarding terminal interest rates have firmed across the $-bloc, apart from Canada, following stronger-than-expected US retail sales and an upward revision to the Atlanta Fed’s GDPNow to 5.4% annualised for Q3.
- Today’s 5-11bps firming in Australian STIR has added to the post-RBA minutes firming seen yesterday. The RBA Board had discussed both leaving rates unchanged and a 25bp hike in October, but it felt that there hadn’t been “sufficient new information” to warrant tightening policy further. But November is clearly live as there will be updated forecasts and more data (Q3 CPI on October 25).
- RBNZ dated OIS pricing is flat to 4bps firmer across meetings today, unwinding some of yesterday’s post-CPI softening. Nevertheless, pricing remains 5-7bps softer than pre-CPI levels.
- Canadian terminal rate expectations have softened by 7bps this week following lower-than-expected headline and core CPI data for September overnight.
- Terminal rate expectations and the cumulative tightening currently stand at: 5.48%, +15bps (FOMC); 5.17%, +17bps (BoC); 4.37%, +30bps (RBA); and 5.66%, +16bps (RBNZ).
Figure 1: $-Bloc STIR: Terminal Rate Expectations & June’24 Pricing
Source: MNI – Market News / Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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