Katie Murray: Yes, sure. Thanks very much. Let me deal with the end of that question. First, you’re absolutely at page 84 and it talks about the foreign exchange, it’s gone from 258 down to 125. I think what you’ve got to remember as well, that we have — NatWest markets as a subsidiary level of the Group. So it’s important that you actually look when you’re trying to look at the Group result is to look at the Group piece, because obviously, they’ve got revenue share and things that go on in different kinds of lines. So it’s not anything to do with the FX management of the U.S. surplus, it is the volatility of our numbers. There is a little bit of in the notable items side, we mentioned some things about 23 million, but that’s not material in that space.
So as I look at that, I do see the strengthening of that performance given that FX we know, we expect to be more volatile this quarter, given the change in that. As I go then onto margins, I think certainly, we’re at 313, for this quarter 320 for the half, we’re saying 315 for the full year, in terms of that the average now rather than the 320, we had originally said. So that I definitely do see some stabilization in terms of that piece. What will happen in terms of that piece is subject to a number of different factors as you’d be aware of. The timing of the U.K. base rate, and we’re assuming a 50 basis points increase at the August MPC meeting, if that comes through in August and September, that will have a little bit of an impact on it. Obviously, the pass through to customer deposit rate, both the timing and the quantum, as well as the customer behavior.
And I’ve talked about that already in terms of that move from the NIBS to the IBBS and then from instant access to fixed term as well has an impact on it. I’m not going to give you the exact what I think on Q3 and Q4. But I think you’re in the right kind of space, it will move around a little bit as we move forward from here. And then, in terms of 2024, I do see the mortgage pressure easing, as we sort of see the roll through of the kind of COVID piece come to the end. We’ll start to see that at the end of 23 and into 2024 as we move forward in that piece of that that is a benefit, certainly to NIM. And I think my last point, I just need to hit on your question. And Jonathan, if I’ve missed anything, let me know at the end. But in terms of the roll off yields, for 2023, we’re rolling off it kind of 1.1, because our hedge is so mechanistic, it’s easy for you to kind of work this out, look at what the swap is what recurs where it’s going five years ago, and you can get a feel for in terms of what’s happening.
So 2023 roll off is 1.1. And then 2024, the roll off rate is lower at around 80 basis points. And 2025 is even lower, again at around 50 basis points. And so that means that even as a five-year swap rate reduces, we do expect through to 2025 that the uplift from the hedge activity remains sizable, particularly with our narrative of this kind of stabilization of deposits.
Jonathan Pierce: That’s really helpful. Thank you. And sorry, just one follow up to that. If the hedge excepting the hedge itself may get smaller, but of course, then you’ll just be rolling into floating rate assets anyway. Given the strength of the hedge tailwind, and the easing of the headwinds into next year, is it in your minds reasonably plausible the margin could start going back up a bit and maybe accelerate into 2025. Is that a reasonable scenario?
