GILTS: Recent Gains Held, Curve Steeper
Gilts have consolidated the bulk of the recent rally, trading little changed vs. Wednesday closing levels.
- Futures -7 at 92.36.
- Initial support and resistance located at 91.60 & 92.51, with the bullish technical cycle intact.
- Yields -1.5bp to +0.5bp, light twist steepening seen on the curve.
- Key support levels in 10- & 30-Year yields (4.496% & 5.309%) remain untouched.
- 10-Year spread vs. Bunds set for the lowest close of the month, last 197bp, ~0.5bp tighter on the day.
- UK headlines point to the need for marginally less fiscal tightening than many envisage, while Chancellor Reeves has signalled that taxes on the wealthy will be “part of the story” when it comes to the Budget.
- Monthly UK GDP data met wider expectations, although the details were a little more mixed. The data had no tangible impact on gilts.
- SONIA futures flat to -1.0.
- BoE-dated OIS pricing ~9bp of easing through year-end.
- BoE’s Mann & Greene are set to speak today, neither expected to vote for a cut at the November meeting.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA (bp) |
Nov-25 | 3.949 | -1.9 |
Dec-25 | 3.879 | -8.8 |
Feb-26 | 3.746 | -22.1 |
Mar-26 | 3.698 | -26.9 |
Apr-26 | 3.601 | -36.6 |
Jun-26 | 3.574 | -39.4 |
Jul-26 | 3.518 | -45.0 |
Sep-26 | 3.500 | -46.8 |
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
GILTS: Back From Highs After Soft Auction
{GB} GILTS: Soft demand at the latest 15-Year auction sees gilts away from session highs.
- Futures back to ~91.50.
- A bullish cycle remains in play. Initial resistance at 91.82. Initial support at 90.65.
- Yields 1.5bp higher to 0.5bp lower, curve twist flattens.
- Modest hawkish adjustment in GBP STIRs, SONIA futures flat to -1.0, BoE-dated OIS pricing ~7.5bp of cuts through year-end, aided by the qauntiy side of the labour market readings.
- We don’t think this morning’s data will be gamechanger for the BoE, particularly with wage data slightly softer than expected at this early stage in the Q3 cycle (see our earlier run of post-data bullets for more colour).
- A reminder that we have CPI data tomorrow ahead of the BoE decision on Thursday (full CPI preview here).
- Focus following Thursday’s BoE decision is likely to fall on the QT announcement for 25/26, with consensus looking for no change in Bank Rate.
- We argue that either active gilt sales continuing at their current pace or being suspended completely would be the optimal position for the market.
- U.S. President Trump’s state visit is set to provide headlines over the next 48 hours, with U.S. firms outlining increased investment intentions re: the UK in recent days.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Sep-25 | 3.976 | +0.9 |
Nov-25 | 3.935 | -3.2 |
Dec-25 | 3.893 | -7.4 |
Feb-26 | 3.786 | -18.1 |
Mar-26 | 3.754 | -21.4 |
Apr-26 | 3.683 | -28.4 |
SLOVAKIA AUCTION RESULTS: SlovGB Results
| Coupon | 3.625% | 3.75% | 0.375% | 4.00% |
| Maturity | Jun-33 | Feb-35 | Apr-36 | Feb-43 |
| Instrument | SlovGB | SlovGB | SlovGB | SlovGB |
| ISIN | SK4000023230 | SK4000022539 | SK4000018958 | SK4000022547 |
| Amount | E97mln | E229mln | E81mln | E105mln |
| Previous | E163mln | E190mln | E150mln | E219mln |
| Avg yield | 3.186% | 3.418% | 3.538% | 4.040% |
| Previous | 3.268% | 3.431% | 3.511% | 3.981% |
| Bid-to-cover | 5.09x | 4.30x | 3.72x | 3.85x |
| Previous | 1.80x | 4.90x | 2.95x | 1.96x |
| Avg Price | 102.953 | 102.628 | 72.462 | 99.487 |
| Low Price | 102.770 | 102.575 | 72.369 | 99.266 |
| Pre-auction mid | 102.659 | 102.167 | 72.163 | 99.047 |
| Prev avg price | 102.473 | 102.578 | 70.915 | 100.232 |
| Prev low price | 102.410 | 102.578 | 70.854 | 100.095 |
| Prev mid-price | 102.510 | 102.051 | 70.469 | 99.844 |
| Previous date | 16-Jun-25 | 16-Jun-25 | 18-Nov-24 | 20-Jan-25 |
EURUSD TECHS: Bullish Theme Remains Intact
- RES 4: 1.1923 2.00 proj of the Feb 28 - Mar 18 - 247 price swing
- RES 3: 1.1851 High Sep 10 2021
- RES 2: 1.1829 High Jul 01 and the bull trigger
- RES 1: 1.1811 Intraday high
- PRICE: 1.1807 @ 10:25 BST Sep 16
- SUP 1: 1.1694/43 20- and 50-day EMA values
- SUP 2: 1.1574 Low Aug 27
- SUP 3: 1.1528 Low Aug 5
- SUP 4: 1.1392 Low Aug 1 and bear trigger.
The trend theme in EURUSD remains bullish. Resistance at 1.1743, the Aug 22 high, has recently been cleared reinforcing a bull cycle. Today’s gains have resulted in a climb above 1.1789, the Jul 24 high, exposing 1.1829, the Jul 01 high and bull trigger. Clearance of this hurdle would confirm a resumption of the primary uptrend. Support to watch is the 50-day EMA, at 1.1643. A clear breach of it would signal scope for a deeper retracement.
