PWLB briefing
End of Day Wrap-Up
UK gilt yields rose notably across the curve today, driving PWLB maturity rates higher and increasing borrowing costs for local authorities.
GILT MOVE SUMMARY
- → 5y: 4.964% (+3bp) — moderate rise at the short end.
- → 10y: 5.373% (+4bp) — belly yields moved higher in line with the curve.
- → 20y: 5.920% (+7bp) — long-dated yields led the move upward.
- → 50y: 5.369% (+5bp) — gains extended to the ultra-long end.
PWLB CLOSE SNAPSHOT
| Tenor | Rate | Change |
|---|---|---|
| 1y | 5.48% | +3bp |
| 5y | 6.03% | +5bp |
| 10y | 6.45% | +5bp |
| 25y | 6.96% | +6bp |
| 50y | 6.68% | +7bp |
WHAT DROVE TODAY
- → Global bond sell-off — News flow highlighted a renewed global bond sell-off, with UK, French, Italian, and US yields all rising sharply amid inflation concerns and higher oil prices.
- → UK data — The 2031 gilt auction cleared at 4.84% (previous: 4.28%), reflecting higher funding costs, while the Lloyds House Price Index was flat YoY (Actual: 0.0%, Forecast: -0.20%, Previous: -0.40%).
- → Inflation and oil — Commentary cited rising oil prices and persistent inflation worries as key factors pushing yields higher.
WHAT THIS MEANS
- → PWLB maturity rates increased by +3bp to +7bp across the curve, reflecting the parallel move in gilts.
- → Borrowing costs for local authorities are higher at all standard tenors compared to yesterday.
- → Long-dated funding saw the largest increases, with 20y, 30y, 40y, and 50y PWLB rates all up by +7bp.
NEXT ON THE DIARY
- → Thu 00:01: RICS House Price Balance (Forecast: -30%)
- → Thu 07:00: UK GDP MoM (Previous: 0.40%), GDP 3-Month Avg (Forecast: 0.50%)
PWLB rates ended the day higher across all maturities, reflecting a broad-based rise in gilt yields amid renewed global inflation concerns and higher oil prices.
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.