BUNDS: German 10yr Yields spikes above 2.90%
* Bund plummets, the German Yield lags, as Futures moves too fast, and is now above 2.90%. * Next ...
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STIR: 80bp Of BoE Cuts Priced Through Year-End
GBP STIRs adjust to weakness in core global FI markets seen late yesterday and in Asia hours, after President Trump agreed to delay the imposition of tariffs on Canada (he did the same with Mexico earlier on Monday).
- BoE-dated OIS shows ~80bp of cuts through year-end, after pricing ~84bp of easing over that horizon yesterday.
- 24bp of cuts priced for this week’s BoE decision, with ~47.5bp of cuts showing through May.
- We look for 25bp cuts at both of those decisions, expect our full preview of this week’s meeting to be released later today.
- SONIA futures little changed to -5.0.
- December highs in SFIZ5 remain untested.
- The recent run of dovish repricing may have reached its limit, unless we get a fresh catalyst.
- We believe that more data is needed before we can give a meaningful view on monetary policy beyond the Bank’s May meeting.
- Little of note on the UK calendar today, which will leave focus on cross-asset flows and tariff-related headlines.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Feb-25 | 4.465 | -23.9 |
Mar-25 | 4.406 | -29.8 |
May-25 | 4.230 | -47.4 |
Jun-25 | 4.149 | -55.5 |
Aug-25 | 4.029 | -67.4 |
Sep-25 | 3.998 | -70.6 |
Nov-25 | 3.923 | -78.1 |
Dec-25 | 3.902 | -80.2 |
STIR: 65bps of ECB Cuts Priced Through The Next Three Meetings
Euribor futures trade within yesterday’s ranges, with global markets displaying a relatively contained reaction to China’s tariff retaliation against the US overnight. Futures are -0.5 to -3.5 ticks through the blues.
- ECB-dated OIS continue to more than fully price a 25bp cut in March, with 20bps of sequential cuts priced through April and another 18bps through June.
- 87bps of easing are priced through year-end.
- Although flash January inflation was a little above consensus on the headline and core measures yesterday, underlying core and services inflation momentum continued to ease.
- Today’s regional calendar is light, with Banque de France Governor Villeroy scheduled to speak at 1330GMT/1430CET.
| Meeting Date | ESTR ECB-Dated OIS (%) | Difference Vs. Current Effective ESTR Rate (bp) |
| Mar-25 | 2.403 | -26.5 |
| Apr-25 | 2.205 | -46.3 |
| Jun-25 | 2.023 | -64.5 |
| Jul-25 | 1.947 | -72.1 |
| Sep-25 | 1.853 | -81.5 |
| Oct-25 | 1.831 | -83.7 |
| Dec-25 | 1.797 | -87.1 |
| Feb-26 | 1.795 | -87.3 |
| Source: MNI/Bloomberg. | ||
EQUITY TECHS: E-MINI S&P: (H5) Bearish Threat Still Present
- RES 4: 6178.75 High Dec 6 and key resistance
- RES 3: 6162.25 High Jan 24
- RES 2: 6147.75 High Jan 31
- RES 1: 6069.00 High Feb 3
- PRICE: 6017.50 @ 07:25 GMT Feb 4
- SUP 1: 5935.50 Low Feb 3
- SUP 2: 5892.37 76.4% retracement of the Aug 5 - Dec 6 bull leg
- SUP 3: 5842.50 Low Jan 14
- SUP 4: 5809.00 Low Jan 13 and a key resistance
The S&P E-Minis contract started the week on a bearish note. The gap lower Monday and a breach of support at 5948.00, the Jan 27 low, strengthens a bearish threat and cancels - for now - a recent bullish theme. An extension down would open 5892.37, a Fibonacci retracement point. Initial resistance is at 6069.00, today’s intraday high. Gains are considered corrective, however, a stronger rally would expose key resistance at 6178.75, the Dec 6 high.
