Daily Flows

• There are attractive term deposit offerings across all credit rating buckets, with 5.20% for 2 years (BBB), 5.20% for 9 month (BBB+) & 5.25% for 1 year (A).
• Off the back of a hawkish pause from the Fed, 1-5 year swaps have jumped 8-12 basis points.
• Bond yields have sold off with elevated offerings across the 1-5 year range.
• Domestic NCD margins are +40 for 3 months and +45 from foreign branch banks.

Surprise Pause From the BoE

• Bank of England took markets by surprise and held policy interest rate at 5.25% yesterday.
• It was a narrow call to hold interest rates in Great Britain, with five votes in favour and four against.
• Like many central banks across the globe, they are using a data dependant approach to facilitate their monetary policy decisions 
• The BoE is expecting a significant decline in CPI inflation in the near term, driven by declining food prices and lower energy inflation. This is in spite of rising oil prices.
• ‘Finely balanced’ and ‘soft landing’ has been the flavour of the month for Central Bank rhetoric, as they all look to stifle inflation without significant downturn in their respective economies.