PWLB briefing
Morning Rate Update
Significant falls across the PWLB curve this morning, with double-digit declines at every maturity as rates reset sharply lower.
⚠ VOLATILITY ALERT — PWLB AM rates reset 9–12bp lower across all maturities, driven by a marked drop in gilt yields following weak UK GDP data and easing geopolitical tensions.
PWLB rates tumble as UK growth stalls and market nerves ease
PWLB SNAPSHOT
| Tenor | Rate | Chg |
|---|---|---|
| 1y | 5.04% | -11bp |
| 3y | 5.22% | -12bp |
| 5y | 5.37% | -12bp |
| 10y | 5.84% | -11bp |
| 25y | 6.45% | -10bp |
| 50y | 6.24% | -10bp |
Parallel shift lower across the curve, with all key maturities down 10–12bp.
WHAT MOVED
- → Front-end and belly — 1y to 10y maturities fell 11–12bp, matching the long end.
- → Long end — 25y and 50y rates dropped 10bp, keeping the curve shape broadly intact.
- → No material divergence — The move is a uniform, parallel drop across all maturities.
CONTEXT
- → UK GDP MoM (Apr): -0.10% actual (forecast: -0.10%, previous: +0.30%) — confirms a contraction, in line with expectations but a sharp reversal from March.
- → UK Manufacturing Production MoM: +0.40% actual (forecast: -0.20%, previous: +1.20%) — better than forecast, but not enough to offset weak GDP.
- → Geopolitical risk easing: News flow highlights progress toward a US-Iran deal, with oil and risk assets rallying and safe-haven demand for gilts easing.
CALENDAR EVENTS
TODAY'S RELEASES
- → GBP GDP MoM (07:00): -0.10% actual (forecast: -0.10%, previous: +0.30%) — confirms a contraction, likely supporting the drop in yields.
- → GBP Manufacturing Production MoM (07:00): +0.40% actual (forecast: -0.20%, previous: +1.20%) — above forecast, but overshadowed by GDP weakness.
REMAINING TODAY
- → 12:00: GBP NIESR Monthly GDP Tracker — Forecast: 0.70%
- → 15:00: USD Michigan Consumer Sentiment Prel — Forecast: 46
NEXT 48 HOURS
- → Wed 17 Jun 07:00: GBP Inflation Rate YoY — Forecast: 3.10%
- → Wed 17 Jun 19:00: USD Fed Interest Rate Decision — Forecast: 3.75%
- → Thu 18 Jun 07:00: GBP Unemployment Rate — Forecast: 5.0%
- → Thu 18 Jun 12:00: GBP BoE Interest Rate Decision — Forecast: 3.75%
⚑ Treasurer's Note — The entire PWLB curve has dropped 10–12bp at the AM reset, with 1y now at 5.04% and 50y at 6.24%. This is a significant parallel move, triggered by confirmation of UK economic contraction and a sharp reversal in risk sentiment as Middle East tensions ease. If you have borrowing to execute, be aware that these rates are locked until the next reset window. Volatility remains high — monitor for further moves at the midday fix.
This commentary is provided for information only and is not financial advice. Please verify rates directly with PWLB or official sources before acting.
Gilt Edge Advisor — when the curve moves, I don’t blink. I just sharpen my pencil.