U.K. 30-Year Yield Tops U.S. as Pressure Mounts on Government Borrowing
5 days ago
- #U.K. Bonds
- #Inflation
- #Debt Crisis
- U.K. 30-year government bond yields exceed U.S. Treasury yields for the first time in over two decades.
- The yield gap reflects growing concerns about the U.K.'s fiscal situation and inflation pressures.
- U.K. 30-year gilt yield at 5.61%, 68 basis points higher than U.S. 30-year Treasury yield.
- Investors demand higher premiums for U.K. debt, signaling wariness over fiscal stability.
- Global advanced economies, including Japan, EU, and U.S., face rising bond yields due to debt and inflation.
- Upcoming U.K. inflation report critical; CPI expected to remain above 2% target.
- Headline CPI forecast at 3.7% YoY, core inflation steady at 3.7%.
- Sticky inflation concerns arise amid weakening GDP growth and rising unemployment.
- Hot inflation could trigger 2022-style volatility, reminiscent of the LDI pension crisis.
- 30-year gilt yield nearing 5.7%, highest since May 1998, risking financial instability.
- Potential for another LDI-style crisis if inflation exceeds expectations.