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4.375% Treasury Gilt 2030 New Issue
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Bob Brook
Posted: 08 January 2025 12:27:06(UTC)
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AlanP2;330405 wrote:
From my limited reading US and other major economies government bond yields have also risen as the bond vigilantes start to play so it isn't a UK specific issue.

As for having made a capital loss surely that is only crystalised if you sell? I would have thought most people buying a 2030 bond would be planning on holding until maturity and getting back exactly what they expected.

I could be totally wrong about either or both of these points as I don't follow macro / monetary policies that closely and don't understand bonds that much so have never purchased one directly.


UK yields have risen more. There is backdrop of rising yields but the UK is a bit of an outlier. BOE is still selling its long dated gilts as well adding more pressure.

You are of course right about the capital loss, i'm sure it looks painful to those with long bonds but the income still keeps coming in. (assuming you didn't buy in the 0% era...!)
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Sara G on 08/01/2025(UTC)
Wave Action
Posted: 08 January 2025 12:27:12(UTC)
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No good blaming politicians DT and RR etc it's a worldwide trend in recent months. Markets are on to something and maybe persistent inflation. ? Well if it was hard recession they'd be cutting ? Or is that the next stage down the line ?

Set all these 10 YR bond charts to 25 years to get the bigger picture...

https://tradingeconomics...s/government-bond-yield

https://tradingeconomics...m/government-bond-yield

https://tradingeconomics...n/government-bond-yield

https://tradingeconomics...y/government-bond-yield

If you're a believer in history repeating itself then the1920's was a similar period. Spanish flu followed by inflation then a lull and inflation picked up again. Blue line is inflation and red stock market. We're around 1922 period now so tricky times ahead.

https://pbs.twimg.com/me...ormat=png&name=small
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Sara G on 08/01/2025(UTC)
Thrugelmir
Posted: 08 January 2025 14:25:58(UTC)
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Sara G;330404 wrote:

I don't think RR will resign over it. They will find a way to blame the previous government or some global macro drivers that have absolutely nothing to do with the recent budget, and nothing at all like what happened after the Truss budget.




Truss budget was never enacted though. Much of Reeves budget is yet to hit the economy. Higher borrowng costs might well be just the beginning of a very damaging period for the UK economy.
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Guest on 08/01/2025(UTC)
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