GILTS: Futures To Fresh Session Lows
Jun-05 15:09
The combination of spill over from the ECB decision, the uptick in oil and Trump-Xi call developments has pressured gilts over the last couple of hours.
- Futures to fresh session lows of 91.92.
- Bulls couldn’t pierce next resistance (92.79) during the earlier rally, with the contract now back below the broken cluster of resistance (92.22-40).
- Yields 1-3bp higher across the curve on the day.
- 10-Year yields remain within the wedge we have outlined in recent weeks, defined by the short-term downtrend drawn off the year-to-date highs and the longer run uptrend drawn off the Dec ’21 lows.
- ECB reaction leaves Gilt/Bunds ~6bp tighter on the day at ~203bp last.
- BoE-dated OIS back to ~40bp of cuts through year-end ~1bp more hawkish on the day and compared to the ~44bp priced at one stage this morning.
- SONIA futures essentially unchanged on the day. Implied terminal policy rate pricing flat (SFIZ6) at 3.605%.
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