Trial now

Health Ministers Release Joint Statement




Precatorios Bill May Be Voted On This Thursday


Chairman Powell

GILTS: VIEW: Wednesday saw Bank of America Research note that they "were an
outlier in expecting the Bank of England to slow its purchase pace, but even we
were surprised by the size of the cut (and the likelihood that the pace will
slow further). So a bit of long-end Gilt steepening as a result is no surprise.
However, it does not seem justified if effective long-end Gilt supply proves as
light as we expect. We expect a new supply remit of GBP100bn to be announced (by
the DMO) on Monday, covering the three months from July to September, with
issuance slowing further thereafter. As we see the skew to shorter-dated
issuance persisting, however, we expect the effective net supply of long-dated
Gilts (DMO less BoE) to be tiny. We therefore maintain our ASW curve steepening
and 5y linker iota narrowing biases. And the Gilt yield curve now looks too
steep beyond 10 years, considering it on a forward starting basis."
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |