End of Day Wrap-Up

UK gilt yields rose sharply across the curve today, driving PWLB maturity rates to new highs and increasing borrowing costs for local authorities.

GILT MOVE SUMMARY

• → 2y: 4.761% (+10bp) — front-end led the move higher.
• → 5y: 4.955% (+14bp) — largest increase on the curve.
• → 10y: 5.292% (+13bp) — belly yields climbed in line with the front end.
• → 30y: 5.827% (+8bp) — long end rose, but less than shorter maturities.

PWLB CLOSE SNAPSHOT

• → 1y: 5.44% (+2bp)
• → 5y: 5.88% (+3bp)
• → 10y: 6.23% (+3bp)
• → 25y: 6.70% (+2bp)
• → 50y: 6.40% (+3bp)

WHAT DROVE TODAY

There was no major UK economic data released today. The sharp rise in gilt yields appears to have been driven by global factors, notably a surge in US Treasury yields after the Federal Reserve signalled further rate hikes may be needed to contain inflation. Commentary highlighted the 10-year US Treasury yield reaching its highest level since 2007 and reiterated hawkish Fed messaging, including remarks from Governor Barr that "further policy adjustments are likely to be needed." Rising oil prices and concerns over a potential US diesel export ban also contributed to a risk-off tone in global rates markets.

WHAT THIS MEANS

• → PWLB maturity rates increased by 2–3bp across the curve, reflecting the sharp move in gilts.
• → Borrowing costs for local authorities are now at new cycle highs for most tenors.
• → The move was led by global rate repricing rather than domestic data.

NEXT ON THE DIARY

• → Calendar is light into the next business day.

Today’s global-led repricing has left UK local authority borrowing rates at their highest levels of the year, with no immediate domestic data scheduled to provide relief.

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.