PWLB briefing
End of Day Wrap-Up
UK gilt yields declined across most maturities today, leading to a modest downward adjustment in PWLB rates at longer tenors, while short-end PWLB rates edged slightly higher.
GILT MOVE SUMMARY
- → 1y: 4.281% (+2bp) — short end slightly higher.
- → 5y: 4.995% (-3bp) — belly yields fell modestly.
- → 10y: 5.322% (-3bp) — declines extended into the intermediate sector.
- → 30y: 5.790% (-6bp) — long end led the rally.
PWLB CLOSE SNAPSHOT
| Tenor | Rate | Change |
|---|---|---|
| 1y | 5.55% | +1bp |
| 5y | 6.06% | +2bp |
| 10y | 6.40% | +1bp |
| 25y | 6.81% | unch |
| 50y | 6.50% | +1bp |
WHAT DROVE TODAY
- → UK inflation data surprised to the upside — CPI YoY printed at 3.50% (Forecast: 3.40%, Previous: 3.10%), with core CPI at 2.80% (Forecast: 2.70%, Previous: 2.60%).
- → No clear single driver for the gilt rally — Despite the inflation surprise, yields fell, particularly at the long end, with no major UK-specific news or events cited as a catalyst.
WHAT THIS MEANS
- → PWLB rates ended the day little changed overall — minor increases at the short end, unchanged at 25y, and a small uptick at 50y.
- → Long-term borrowing costs remain elevated — 25y and 50y PWLB rates are still above 6.5%.
- → Yield curve flattened modestly — long gilts outperformed, narrowing the spread to shorter maturities.
NEXT ON THE DIARY
- → Thu 11:00 — CBI Business Optimism Index (Forecast: -38)
- → Thu 11:00 — CBI Industrial Trends Orders (Forecast: -20)
- → Thu 11:50 — BoE Gov Bailey Speech
PWLB rates remain closely aligned with gilt market moves, and local authority borrowing costs were broadly stable to slightly higher at the short end today.
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.