Morning PWLB Predictions

Headline

Gilt Yields Dive as 50-Year Bonds Plummet 475bps; PWLB Rates Hold Steady

Gilt Market Analysis

The gilt market is experiencing significant volatility this morning, with yields across various tenors dropping sharply. The 1Y yield has decreased by 366bps, while the 10Y yield has fallen by 413bps. In the long end, the 30Y yield has also seen a notable decline of 525bps. This movement is largely driven by a risk-off sentiment in the market, influenced by geopolitical tensions and a weaker dollar, which has prompted investors to seek the safety of government bonds.

PWLB Reset Predictions

• 1y: predicted 4.60% (0bp from current)
• 5y: predicted 5.04% (0bp from current)
• 10y: predicted 5.61% (0bp from current)
• 20y: predicted 6.17% (0bp from current)
• 30y: predicted 6.26% (0bp from current)
• 50y: predicted 6.03% (0bp from current)

Context

The predictions reflect the current stability in PWLB rates, as there have been no changes anticipated following the significant movements in gilt yields. The market's focus remains on geopolitical developments and their potential impact on economic conditions.

Calendar Events

Releases So Far Today

• GBP Car Production YoY: Actual: 17.7%, Forecast: 6.7%, Previous: -14.3% (MED impact) - This positive surprise may indicate stronger manufacturing activity, which could influence gilt yields positively.

Remaining Today

• No further releases scheduled for today.

This Week Ahead

• Tomorrow 07:00: GBP Nationwide Housing Prices MoM (forecast 0.6%)
• Tomorrow 07:00: GBP Nationwide Housing Prices YoY (forecast 1.5%)
• Tomorrow 09:30: GBP Mortgage Lending (forecast 4.60B)
• Tomorrow 09:30: GBP Net Lending to Individuals MoM (forecast 4.20B)
• Tomorrow 09:30: GBP Mortgage Approvals (forecast 64.40k)
• Tomorrow 09:30: GBP BoE Consumer Credit (forecast 1.90B)
• Tomorrow 09:30: GBP M4 Money Supply MoM (forecast 0.01)
• Monday 09:30 (2026-02-02): GBP S&P Global Manufacturing PMI Final (forecast 51.6)
• Tuesday 10:00 (2026-02-03): GBP Treasury Gilt 2035 Auction (LOW impact)
• Wednesday 09:30 (2026-02-04): GBP DMP 1Y CPI Expectations (Previous: 3.2%)

This commentary is provided for informational purposes only and should not be construed as financial advice. Market conditions can change rapidly, and you should always verify current rates directly with the PWLB or through official channels before making borrowing decisions. Past performance is not indicative of future results.

Stay informed and keep your treasury operations running smoothly!