The OBR has released its breakdown of.........>

GILTS: The OBR has released its breakdown of public sector borrowing and PSNCR

numbers by month. Below shows PSNCR by month. They estimate GDP to fall by 35%

in Q2, before rebounding 27% in Q3 with 2020 as a whole falling 12.8%. For

unemployment they estimate a 10% rate in Q2 with 8.5% in Q3.

- They estimate CGNCR at GBP291.6bln for the year (before the latest furlough

figures). This was estimated at GBP65.3bln back in March - so this is GBP226.bln

more than previously. This would indicate gilt sales of GBP382.4bln for the

fiscal year (we have already seen GBP225bln announced for April to July). So

that would mean GBP157.4bln for the August to March period (just under

GBP20bln/month - plus any extra for the extended furlough scheme.

- That's not the full story, however. April to July sees two big gilt

redemptions on top of estimated CGNCR of GBP261.4bln. For the April to July

period there will be a shortfall in CGNCR of GBP36.4bln (some of which can

probably be made in in bills and through the Ways and Means). (1/2)