GILTS: Off Early Lows, BoE's Greene & Trade Cues Eyed

Gilts in tight ranges early Friday, with futures consolidating in the upper end of the ranges witnessed over the prior couple of sessions.

• Mixed trade messaging from the U.S. & China, as well as a slightly more constructive BBG source report pointing to the potential for China easing some tariffs imposed on U.S. goods, leave gilts little changed
• Firmer-than-expected retail sales (accompanied by negative revisions) won’t be enough to impact BoE policy given the volatile nature of the data and broader uncertainty stemming from global trade dynamics.
• Futures printed as low as 92.90 before recovering to ~93.10 last.
• The recent bullish recovery remains intact, with initial support and resistance located at 92.13 & 93.32, respectively.
• Yields flat to 2bp lower, curve flattens.
• 10s last 4.50%, above initial support at 4.46% and uptrend support drawn off the late ’21 lows (4.403% today).
• BoE MPC member Greene will speak this afternoon (15:15 BST). She already sounded a little less hawkish in remarks made earlier this week, although the topic of “inflation, growth and monetary policy” gives her room to provide more insight into her outlook.
• The recovery from lows in gilts unwinds the initial, modest hawkish move in GBP STIRs.
• BoE-dated OIS now little changed across ’25 meetings, showing 89bp of cuts through December, with the next 25bp move still fully discounted come the end of the May meeting.
• SONIA futures flat to +3.0.