{"id":1661416,"date":"2022-09-28T06:07:46","date_gmt":"2022-09-28T10:07:46","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1661416"},"modified":"2022-09-28T06:08:49","modified_gmt":"2022-09-28T10:08:49","slug":"cracks-appear-in-uk-gilt-market-as-long-dated-yields-hit-5-2","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/cracks-appear-in-uk-gilt-market-as-long-dated-yields-hit-5-2\/","title":{"rendered":"Cracks appear in UK gilt market as long-dated yields hit 5%"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">22<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fcracks-appear-in-uk-gilt-market-as-long-dated-yields-hit-5-2%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1661416&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>By Andy Bruce and William Schomberg<\/p>\n<p>LONDON (Reuters) \u2013     British government 30-year bond yields hit a 20-year high on Wednesday, pushing past 5%, and bond strategists warned that markets were becoming close to untradeable due to volatility, something the Bank of England will be watching with alarm.<\/p>\n<div id=\"div-gpt-ad-1663871513696-art-1\">\n<\/div>\n<p>In a sign of very poor liquidity, it took several minutes after the market opened for data providers Refinitiv and Tradeweb to show prices for longer-dated benchmark debt \u2013 unusual in a core government bond market.<\/p>\n<p>When they did show, yields on 20- and 30-year gilts pushed above 5% on Wednesday as a sell-off extended into a fourth trading day after the government announced sweeping tax cuts last week.<\/p>\n<p>The BoE is watching market conditions ahead of an expected announcement of details of its first \u201cquantitative tightening\u201d sales of gilts, which will speed up the reversal of its huge bond buying since the 2007-08 global financial crisis.<\/p>\n<p>\u201cThe gilt market is, I think, close to untradeable,\u201d said Lyn Graham-Taylor, a rates strategist at Rabobank.<\/p>\n<p>\u201cI think primary dealers will be having no interest in holding any inventory, or won\u2019t actually be allowed by their risk departments to hold any inventory,\u201d he said.<\/p>\n<p>Another gauge of market dysfunction \u2013 the spread between bid and asking prices \u2013 has also increased sharply in the gilt market in recent days.<\/p>\n<p>BoE Chief Economist Huw Pill said on Tuesday that the central bank would not sell its gilts into a dysfunctional market, but a sharp repricing that reflects changing fundamentals would be not be a reason to pause the programme.<\/p>\n<p>HEAVY SELLING<\/p>\n<p>Twenty-year gilt yields rose as high as 5.041%, their highest since 2008, while yields on 30-year gilts hit 5.075%, the highest since 2002.<\/p>\n<p>As of 0905 GMT, yields on both bonds had settled back a little but were still up 1 and 5 basis points on the day, respectively.<\/p>\n<p>September looks like it will go down as the worst month for the British government bond market in living memory.<\/p>\n<p>The yield on the 10-year gilt has risen more than 160 basis points in the month to date \u2013 which would be the largest increase since at least 1957, according to a Reuters analysis of Refinitiv and Bank of England data.<\/p>\n<p>On Wednesday the 10-year yield was down 3 basis points on the day at 4.479%. <\/p>\n<p>UBS, a primary dealer of British government bonds, said there were signs of heavy selling from pension funds as the value of gilts plummeted.<\/p>\n<p>\u201cIt is \u2026evident that in long-end of the curve and in linkers, there is a dash-for-cash from the LDI (liability-driven investment) community to meet margin requirements \u2013 a dynamic that is being aggravated now following the sharp sell-off and this being the last trading week of the quarter,\u201d UBS strategist Rohan Khanna said in a note to clients.<\/p>\n<p>Investors were watching closely to see how a sale via syndication of 2053 \u201cgreen gilts\u201d goes. As of 0845 GMT, bookrunners had received orders worth more than 24 billion pounds ($25.62 billion). ($1 = 0.9367 pounds)<\/p>\n<p> (Writing by William Schomberg, editing by Andy Bruce and Alex Richardson)<\/p>\n<p><a href=\"https:\/\/www.oann.com\/uncategorized\/cracks-appear-in-uk\/attachment\/british-pound-coins-are-seen-in-this-illustration\/\"><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/09\/tagreuters.com2022binary_LYNXMPEI8R0EU-BASEIMAGE-1.jpg\" alt=\"tagreuters.com2022binary_LYNXMPEI8R0EU-BASEIMAGE\" \/><\/a><\/p>\n<p><a href=\"https:\/\/www.oann.com\/uncategorized\/cracks-appear-in-uk\/attachment\/file-photo-city-workers-walking-past-the-bank-of-england\/\"><img decoding=\"async\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2022\/09\/tagreuters.com2022binary_LYNXMPEI8R0EG-BASEIMAGE-1.jpg\" alt=\"tagreuters.com2022binary_LYNXMPEI8R0EG-BASEIMAGE\" \/><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Andy Bruce and William Schomberg LONDON (Reuters) \u2013 British government 30-year bond yields hit a 20-year high on Wednesday, pushing past 5%, and bond strategists warned that markets were<\/p>\n","protected":false},"author":66,"featured_media":1889295,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1661416","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_finder_url":"https:\/\/www.oann.com\/business\/cracks-appear-in-uk\/?utm_source=rss&utm_medium=rss&utm_campaign=cracks-appear-in-uk","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1661416","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/66"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1661416"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1661416\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1889295"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1661416"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1661416"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1661416"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}