Why have Britain’s bond yields jumped sharply?
5 days, 4 hours ago

Why have Britain’s bond yields jumped sharply?

Live Mint  

The new year has brought a head-splitting hangover for Britain’s government. Outside Liz Truss’s brief premiership and calamitous mini-budget in 2022, Britain has rarely seen the past month’s pattern of rising gilt yields and a steep drop in the pound. View Full Image Chart: The Economist But unlike October 2022, when Britain’s bond woes were entirely home-grown, today they are mostly imported from America. Treasury yields shot up after Donald Trump’s election win in November, as markets adjusted to his inflationary plans for trade conflict abroad alongside tax cuts and mass deportations at home. Unless bond yields come down again, Ms Reeves will have to raise taxes, cut spending or breach her fiscal rules—which she has described as “iron-clad" and “non-negotiable".

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History of this topic

Government borrowing costs rise further after Budget
2 months, 2 weeks ago

Government borrowing costs rise further after Budget

The Independent  

For free real time breaking news alerts sent straight to your inbox sign up to our breaking news emails Sign up to our free breaking news emails Sign up to our free breaking news emails SIGN UP I would like to be emailed about offers, events and updates from The Independent. Read our privacy policy Government borrowing costs leapt higher …

UK bond market rallies at sharpest pace in Europe amid interest rate hopes
1 year, 2 months ago

UK bond market rallies at sharpest pace in Europe amid interest rate hopes

The Telegraph  

The Government’s cost of short-term borrowing has fallen at the fastest pace in Europe today after the Bank of England’s chief economist raised hopes of interest rate cuts. The yield on two-year UK gilts, which are sensitive to moves in the outlook for interest rates, has dropped by eight basis points today to 4.61pc, its lowest level since June and …

Why are bond yields surging around the global markets? - Explained
1 year, 3 months ago

Why are bond yields surging around the global markets? - Explained

Live Mint  

Over the past six months, the international bonds yield has been on a haywire. Sustained expectations of inflation are likely to keep yields above this conventional range, potentially detrimental to economic growth and the stock market, as both household and corporate spending face constraints. The prevailing high bond yields are primarily driven by the market demands for premiums when investing …

Why are global bond yields rising?
1 year, 4 months ago

Why are global bond yields rising?

Live Mint  

Global bond yields are flaring up to the levels unseen in years, drawing support from strong macroeconomic data that makes a case for continuing with the monetary tightening policy through interest rate hikes. The US treasury yields have climbed almost 40 bps month-to-date amid rising bets that interest rates will remain elevated for longer. However, while the 10-year US yield …

Dollar Gains on Rising US Yields, British Inflation Lifts Pound
1 year, 8 months ago

Dollar Gains on Rising US Yields, British Inflation Lifts Pound

News 18  

The dollar strengthened on Wednesday, lifted by rising Treasury yields, though the pound gained against the greenback after British inflation stayed above 10 percent in March and put more pressure on the Bank of England to keep raising rates. The yield on two-year Treasury notes, which are sensitive to expectations for the U.S. central bank’s monetary policy, rose 7 basis …

The UK just stepped back from the brink. But there’s more trouble ahead
2 years, 2 months ago

The UK just stepped back from the brink. But there’s more trouble ahead

CNN  

London CNN Business — The decision by Jeremy Hunt, the new UK finance minister, to jettison the bulk of Prime Minister Liz Truss’ much-maligned plans to boost growth has come as a huge relief to investors, easing their worries about the sustainability of government finances. It said it sees “additional downside risks to growth” following Hunt’s announcements on Monday. “The …

‘Slow-moving car crash.’ There’s no quick fix for the UK market mess
2 years, 3 months ago

‘Slow-moving car crash.’ There’s no quick fix for the UK market mess

CNN  

London CNN Business — The Bank of England is struggling to contain a crisis triggered by the UK government’s brash plans to borrow heavily to pay for tax cuts, feeding fears that the country’s financial markets could once again spin out of control. “The market’s turned around and said, “We need you to do more.’” Bank of England Governor Andrew …

UK central bank intervenes in market to halt economic crisis
2 years, 3 months ago

UK central bank intervenes in market to halt economic crisis

Associated Press  

LONDON — The Bank of England took emergency action Wednesday to stabilize U.K. financial markets and head off a crisis in the broader economy after the government spooked investors with a program of unfunded tax cuts, sending the pound tumbling and the cost of government debt soaring. The Bank of England said it would buy long-term government bonds over the …

Bank of England will buy UK bonds at ‘whatever scale’ necessary to halt crash
2 years, 3 months ago

Bank of England will buy UK bonds at ‘whatever scale’ necessary to halt crash

CNN  

London CNN Business — The Bank of England said Wednesday it would buy UK government debt “on whatever scale is necessary” in an emergency intervention to halt a bond market crash that it warned could threaten financial stability. “This repricing has become more significant in the past day — and it is particularly affecting long-dated UK government debt,” the central …

Markets are now treating UK bonds like Greek and Italian debt
2 years, 3 months ago

Markets are now treating UK bonds like Greek and Italian debt

CNN  

London CNN Business — The pound may have paused its headlong crash toward parity with the US dollar, but the damage to the UK economy sparked by Prime Minister Liz Truss’ huge tax-cutting gamble is still rippling through financial markets. “This is a situation where government borrowing costs — and therefore all our borrowing costs — are incredibly vulnerable,” economist …

Bank of England urged to call emergency rates meeting next week to rescue pound
2 years, 3 months ago

Bank of England urged to call emergency rates meeting next week to rescue pound

The Telegraph  

The Bank of England has been urged to raise interest rates as soon as next week to help the pound from further weakening. Meanwhile, UK bond yields were on the rise, with the 10-year gilt yields seeing their biggest one-day surge on record in Bloomberg data. Deutsche Bank analysts said there are "very strong signals" that the market is no …

Bank of England poised to take bond-buying plan above $1 trillion
4 years, 2 months ago

Bank of England poised to take bond-buying plan above $1 trillion

Live Mint  

The Bank of England is set to pump up its huge bond-buying stimulus plan to more than $1 trillion on Thursday as Britain's economy takes a fresh hit from new coronavirus lockdowns and another possible blow from a no-deal Brexit. On the day England goes into a month-long "stay-at-home order", alongside restrictions elsewhere in the United Kingdom, the BoE looks …

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