PWLB briefing
Morning Rate Update
Significant reset: PWLB rates jumped 10–12bp at the short end, 8–11bp across the belly, and 3–4bp at the long end, following a sharp selloff in gilts after stronger-than-expected UK GDP and global bond market turmoil.
⚠ VOLATILITY ALERT — AM reset: PWLB rates surged 10–12bp at the front end and 8–11bp across the curve, driven by a stronger UK GDP print and a global bond rout linked to surging oil prices and inflation fears.
PWLB rates leap after UK GDP surprise and global bond selloff
PWLB SNAPSHOT
| Tenor | Rate | Chg |
|---|---|---|
| 1y | 5.46% | +10bp |
| 3y | 5.77% | +12bp |
| 5y | 5.95% | +11bp |
| 10y | 6.34% | +8bp |
| 25y | 6.87% | +4bp |
| 50y | 6.66% | +4bp |
Sharp parallel shift higher across the curve, with the largest moves at the short and intermediate tenors.
WHAT MOVED
- → Front end and belly surge — 1y to 5y rates jumped 10–12bp, with 10y up 8bp.
- → Long end less extreme — 25y and 50y tenors rose 3–4bp, still notable but less violent than the short end.
- → Parallel shift dominates — No major curve twist; this is a broad repricing upward.
CONTEXT
- → UK GDP MoM (Jul): 0.40% actual vs 0.0% forecast (prev 0.30%) — a clear upside surprise, supporting higher yields.
- → Bond market rout: Global bonds sold off sharply overnight as oil surged above $107 and inflation fears intensified, pushing yields higher everywhere.
- → No offsetting UK news: No major UK-specific headlines softening the move; the data and global backdrop are both pushing in the same direction.
CALENDAR EVENTS
TODAY'S RELEASES
- → GDP MoM (Jul): 0.40% actual (forecast 0.0%, prev 0.30%) — much stronger than expected, fuelling the rate surge.
- → Manufacturing Production MoM: 0.90% actual (forecast 0.20%, prev -0.50%) — another strong beat, adding to upward pressure.
- → Industrial Production MoM: 0.20% actual (forecast -0.20%, prev -0.20%) — above forecast, but less dramatic.
REMAINING TODAY
- → 13:30 USD Inflation Rate YoY: Forecast 3.40% — US CPI could add further volatility if it surprises.
- → 13:30 USD Core Inflation Rate YoY: Forecast 2.40%
NEXT 48 HOURS
- → Tue 15 Sep 07:00: UK Unemployment Rate — Forecast: 4.90%
- → Wed 16 Sep 07:00: UK Inflation Rate YoY — Forecast: 3.10%
- → Wed 16 Sep 19:00: US Fed Interest Rate Decision — Forecast: 4.0%
⚑ Treasurer's Note — The AM PWLB reset has delivered a sharp repricing, with 1–5y rates up 10–12bp and 10y up 8bp, following a strong UK GDP print and a global bond selloff. Long-dated rates also rose 3–4bp. If you are waiting for the next reset, be aware that further volatility is possible around US CPI this afternoon. This is the largest single-morning move in recent months — plan accordingly.
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 — cutting through the noise since the yield curve had two humps and a prayer.