EU CONSUMER CYCLICALS: Consumer & Transport: Week in Review
Aug-15 15:13
Relatively strong compression, in line with a high-single digit tightening down in HY. It does look ...
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GILTS: Back From Highs After Futures Close Gap, Labour Market Data Eyed
Jul-16 15:12
Weakness in oil and spillover from the softer-than-expected U.S. PPI data allowed gilt futures to close their opening gap lower, with the rally topping out at 91.73, before a pullback to ~91.50 as questions surrounding Fed Chair Powell’s future resurfaced.
- Bears remain in technical control, with initial resistance clustered at the 20-day EMA & yesterday’s high (92.22/24) going untested.
- Curve bear flattens on the day, yields 3bp higher to flat.
- 2s10s back to ~76.2bp, failing to break above 80bp in recent days. ’25 highs located at 84.6bp.
- 5s30s ~140.5bp, ’25 highs at 147.2bp remain unchallenged.
- SONIA futures -3.0 to +1.0 on the day, strip twist flattens.
- BoE-dated OIS showing ~51bp of cuts through year-end vs. 53.5bp late yesterday and less than 50bp at one stage following CPI data.
- Market continues to price over 80% odds of a cut at next month’s MPC.
- Initial hawkish moves surrounding the firmer-than-expected CPI data faded a little given the lack of material deviation from the BoE’s overall view (across the broader CPI suite) and increased focus on tomorrow’s labour market data following weekend comments from BoE Governor Bailey.
- Our full labour market data preview can be found here.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Aug-25 | 4.006 | -21.2 |
Sep-25 | 3.955 | -26.2 |
Nov-25 | 3.788 | -42.9 |
Dec-25 | 3.705 | -51.2 |
Feb-26 | 3.575 | -64.2 |
Mar-26 | 3.540 | -67.8 |
USD: Greenback Selling Momentum Builds Following Trump/Powell Headlines
Jul-16 15:12
- Following the initial knee-jerk lower for the dollar on the Trump/Powell CBS headlines, we are seeing a bit of follow through here as short-term greenback longs are pressured.
- This is most notable for USDJPY which is now down 0.45% on the session having reversed ~100 pips from the overnight 149.17 highs.
- EURUSD topside also gathering momentum, rising quickly back above 1.16 and approaching the session highs at 1.1628.
US TSYS: Paring Gains on Latest Rumors Over Fed Powell Firing
Jul-16 15:03
- After rising to moderate session highs, Treasury futures have started to pare gains after latest headlines that Pre Trump asked GOP lawmakers if he should fire Fed Chairman Powell now - before the end of his term in May 2026.
- Currently, Sep'25 10Y contract trades +9.5 at 110-18.5 vs. 110-20.5 high. Initial technical resistance above at 111-01 (20-day EMA). Support below at 110-08.5 (Low Jul 14)
- Curves mildly steeper/off lows: 2s10s +.521 at 54.261; 5s30s +1.845 at 99.755.
- USD: Modest dip lower for the greenback, Bbg index BBDXY -0.21 at 1207.24 vs. 1210.13 high.
