EUROPEAN INFLATION: Spain June Inflation Driven Higher By Fuel And Food

Estox 50: -0.01%, Dax: +0.12%, CAC: +0.09%, FTSE +0.05%, SMI -0.13%.

• The Dollar sees another positive start against most G10s,. But looking at the past 5 days, the picture is more mixed, the Pound is up 0.47%, and the SEK is down 0.71% for that period.
• The early focus Overnight has been on the RNBZ, although the Central Bank delivered its 25bps cut down to 3.25%, the vote wasn’t unanimous, with one dissenter.
• The NZD is the best early performer against the Greenback, albeit just up 0.27%
• The November high of 0.6038 remains the main top side to watch out for.
• Support in NZDUSD is also seen further out, down to 0.5896.
• Following the price action in Treasuries, a tick higher in Yields following the weaker JGB long end Auction, next upside resistance in USDJPY are at 144.77/145.68 Intraday high / 50-day EMA.

A flat start for GBP STIRs today, with Bunds and Tsys trading around levels seen at yesterday’s SONIA futures settlement window after sub-par demand at a 40-Year JGB auction applied some pressure overnight.

• SONIA futures -1.0 to +2.0, strip twist flattens.
• BoE-dated OIS within 1bp of yesterday’s closing levels, showing 36bp of cuts through year-end, with ~60% odds of the next 25bp cut priced through the end of the September MPC and 29.5bp of cuts priced through November.
• A text covering comments from BoE chief economist Pill will be released today (on the topic of “monetary policy: taking a walk on the supply side”) although don’t expect it to be market moving as the address was given on Thursday of last week.
• A reminder that Pill has already reaffirmed his position at the hawkish end of the BoE spectrum after lodging a dissenting vote earlier this month (to leave rates on hold).
• Macro cues should be at the fore for much of today.