STIR: Just Over 50bp Of BoE Cuts Priced Through Dec, Macro & Fiscal Eyed
Little net movement in GBP STIRs this morning with core global bonds stabilising away from yesterday’s lows.
- BoE-dated OIS shows 21bp of easing for next month, 27bp through September, 44bp through November and 52bp through year-end.
- Pricing has not been able to push sustainably beyond 55bp of cuts through December in recent weeks.
- We continue to look for cuts in August and November at this stage, with risks skewed dovishly.
- Further softening in the labour market presents the most likely dovish catalyst, with fresh developments on that front likely needed to promote the pricing of a more aggressive easing cycle through year-end.
- SONIA futures flat to +1.0.
- Continued digestion of the global trade/tariff backdrop and ongoing negotiations between various countries and the U.S. continue to garner much of the macro focus.
- Meanwhile, the fragile fiscal situation continues to dominate domestically.
- The release of the BoE’s FSR headlines the UK calendar today, but shouldn’t reveal much in the way of meaningful, fresh information surrounding the future path of monetary policy.
- That will leave macro and cross-market matters at the fore.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Aug-25 | 4.006 | -21.1 |
Sep-25 | 3.949 | -26.8 |
Nov-25 | 3.780 | -43.7 |
Dec-25 | 3.696 | -52.1 |
Feb-26 | 3.567 | -65.0 |
Mar-26 | 3.538 | -67.9 |
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STIR: GBP STIRs Steady, Showing 40bp Of Cuts Through Dec
GBP STIRs are little changed this morning, with Bund & TY futures operating close to levels seen around Friday’s SONIA futures settlement window.
- BoE-dated OIS is little changed to 0.5bp more dovish through year-end. No change priced for this month’s meeting, 15.5bp showing through August, 19bp through September, 33bp through November and ~40bp through year-end.
- SONIA futures are flat to +2.5.
- BoE MPC member Greene used the word “cautious” in her weekend appearance. While the natural reaction would point to hawkish interest rate readthrough, we note that it’s quite hard to contextualise these comments in isolation. We will try to do so when the video stream to the event becomes available (no ETA).
- A reminder that Greene softened her usually hawkish stance in the wake of the May MPC and wasn’t a hawkish dissenter at that event.
- Greene also reaffirmed expectations for inflation to move to target and stressed that the Bank is “not sanguine” about the prospect of an “inflation hump”.
- Labour market data is due tomorrow, expect our full preview of that release later today. A reminder that the BoE has placed more weight on labour market inferences from surveys, given the long running issues with the ONS readings.
- Elsewhere, the government will publish its spending review on Wednesday, expect plenty more from both us and our political risk team on the matter ahead of that event.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Jun-25 | 4.216 | +0.4 |
Aug-25 | 4.057 | -15.5 |
Sep-25 | 4.018 | -19.4 |
Nov-25 | 3.885 | -32.7 |
Dec-25 | 3.817 | -39.5 |
Feb-26 | 3.725 | -48.7 |
Mar-26 | 3.705 | -50.7 |
USD: Extending intraday lows into the EU Sesssion
- The Dollar starts the session in the Red, a continuation from the Overnight session, while the small push lower in US Yields could a be a driver, most Yields are still trading closer to the June high, printed on Friday post NFP.
- Small downside continuation are going through in the Dollar as Europe joins the session.
- A new intraday low for the Greenback against the EUR, GBP, JPY, CZK, THB, SGD, and the ZAR.
- The Kiwi is still the best early performer, up 0.45%, and initial resistance comes at 0.6055 in NZDUSD.
- The Yen is quickly catching up, and is the 2nd best performer now within G10s, with the USDJPY looking to drift back towards 144.00.
- Overall the Yen is still down over 1% for the past 5 days, and small support in USDJPY is seen further out, below the figure, down to 143.44.
- The Pound and the EUR are now also testing intraday lows versus the Yen.
EQUITY TECHS: E-MINI S&P: (M5) Fresh Cycle High
- RES 4: 6124.00 High Feb 24
- RES 3: 6080.75 High Feb 26
- RES 2: 6057.00 High Mar 3
- RES 1: 6025.00 High June 6
- PRICE: 5996.50 @ 07:22 BST Jun 9
- SUP 1: 5883.97/5789.75 20- and 50-day EMA values
- SUP 2: 5756.50 Low May 23
- SUP 3: 5596.00 Low May 7
- SUP 4: 5455.50 Low Apr 30
The trend condition in S&P E-Minis is unchanged, it remains bullish and the contract traded to a fresh cycle high last week. The recent break of 5993.50, the May 20 high and a bull trigger, highlights a resumption of the uptrend and maintains a price sequence of higher highs and higher lows. A continuation would open 6057.00 next, the Mar 3 high. Key support lies at 5789.75, the 50-day EMA.
