PWLB briefing
End of Day Wrap-Up
UK gilt yields rose sharply across the curve today, driving PWLB maturity rates higher by up to +3bp and increasing borrowing costs for local authorities.
GILT MOVE SUMMARY
| Tenor | Yield | Change |
|---|---|---|
| 1y | 4.117% | +7bp |
| 5y | 4.402% | +10bp |
| 10y | 4.837% | +8bp |
| 30y | 5.535% | +8bp |
| 50y | 5.149% | +9bp |
Gilt yields rose 7–10bp across the curve, with the move led by the 5y sector but broad-based in nature.
PWLB CLOSE SNAPSHOT
| Maturity | Rate | Change |
|---|---|---|
| 1y | 5.06% | +1bp |
| 5y | 5.40% | +3bp |
| 10y | 5.87% | +3bp |
| 25y | 6.48% | +2bp |
| 50y | 6.30% | +3bp |
WHAT DROVE TODAY
- → UK economic data — May retail sales surprised to the upside (MoM: +1.20% actual vs +0.50% forecast, previous -1.0%; YoY: +3.20% actual vs +1.90% forecast), suggesting stronger consumer activity.
- → Political and fiscal news — Gilt yields rose amid heightened political uncertainty following Andy Burnham's by-election victory and a larger-than-expected May public sector borrowing figure (£23.2bn actual vs £19bn forecast), with multiple sources citing renewed market focus on UK fiscal risks.
WHAT THIS MEANS
- → PWLB maturity rates — Ended the day 1–3bp higher across the curve, reflecting the parallel move in gilts.
- → Borrowing costs — Increased modestly for all standard tenors, with the largest moves in the 5y, 10y, 20y, 30y, and 50y buckets.
- → Curve shape — The move was broadly parallel, with no significant steepening or flattening.
NEXT ON THE DIARY
- → Tuesday 09:30 — S&P Global Manufacturing PMI Flash (Forecast: 53.4)
- → Tuesday 09:30 — S&P Global Services PMI Flash (Forecast: 49)
- → Tuesday 11:00 — CBI Industrial Trends Orders (Forecast: -46)
Borrowing conditions tightened modestly today as market attention remained focused on UK fiscal developments and political uncertainty.
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.