PWLB briefing
End of Day Wrap-Up
UK gilt yields rose sharply across the curve today, driving PWLB maturity rates to new cycle highs and materially increasing local authority borrowing costs.
GILT MOVE SUMMARY
- → 2y: 4.54% (+12bp) — front-end yields rose strongly.
- → 10y: 5.17% (+16bp) — belly led the move higher.
- → 30y: 5.85% (+19bp) — long-end yields surged, matching the scale of the move in the belly.
- → Curve shape — bear steepening, with the largest increases in the 15–30y sector.
PWLB CLOSE SNAPSHOT
| Tenor | Rate | Change |
|---|---|---|
| 1y | 5.29% | +1bp |
| 5y | 5.67% | +3bp |
| 10y | 6.15% | +3bp |
| 25y | 6.75% | +4bp |
| 50y | 6.53% | +3bp |
WHAT DROVE TODAY
- → No major UK data releases — only the NIESR Monthly GDP Tracker (LOW impact) was published.
- → Global bond selloff and inflation fears — news flow highlighted intensifying concerns over inflation, rising oil prices, and the impact of the Iran war, with global yields rising in tandem.
- → UK political uncertainty — reports cited leadership challenges and speculation over fiscal policy as contributing to higher UK borrowing costs.
WHAT THIS MEANS
- → PWLB maturity rates closed at new cycle highs — increases ranged from +1bp (1y) to +4bp (15–40y).
- → Borrowing costs rose across all terms — the largest moves were in the 10–40y sector, reflecting the steepening gilt curve.
- → Market volatility remains elevated — driven by global inflation concerns and domestic political headlines.
NEXT ON THE DIARY
- → Tuesday 07:00 — UK Unemployment Rate (HIGH), forecast 5.10% (prev 4.90%)
- → Tuesday 07:00 — UK Average Earnings incl. Bonus (MEDIUM), forecast 3.80% (prev 3.80%)
Today’s sharp rise in gilt yields and PWLB rates underscores the sensitivity of borrowing conditions to both global inflation risks and domestic political developments.
This commentary is for information only and does not constitute financial advice. Always verify rates directly with PWLB or official sources before making borrowing decisions.