I think it's going to be a tense debate whether or not the Fed cuts. There's a lot of data coming out over the next few weeks. Historical precedent from 2013 shutdown suggests we'll get a lot of the September data but there's uncertainty on October payrolls. The ADP data is new and less correlated with nonfarm payrolls. We expect around 50,000 for September NFP. Regarding yields, if the UK Chancellor can make a bigger fiscal buffer, it could ease gilt yields. However, political instability is causing concerns and the market focuses on budget delivery.

The UK labor market data shows unemployment at 5%, traders betting on a Bank of England rate cut in December. We see that as consistent with our expectations due to concerns about labor market softness.

It's difficult to speculate levels, but a structural surplus, perhaps driven by tax policy, would calm markets and could lead to lower yields.