The euro swaps saw an almost parallel rally, continuing yesterday's move. The dollar swaps rallied with a slight flattening. And the awesomest moves were in sterling swaps, with a sharp rally and an equally sharp steepening across the curve, following BoE's report on inflation. Is it overdone? More likely than not. But fading still looks on the riskier side. Best to book profits on long steepeners and short payers. The next expected big move is not before June ECB. But honestly I have no idea what is behind the big sterling moves today. The report dashed the hope of imminent hike in bank rate, but was nowhere beyond expectation. And given recent moves and positioning to best of my knowledge, don't see any strong technical reasons either. Need to dig deeper. Something here is not consistent.
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