Global bond market turmoil escalated on Thursday, pushing Britain’s 30-year bond yield above the 6% threshold—a level not witnessed since 1998. The spike in long-term borrowing costs is largely attributed to growing anxieties regarding the sustainability of the United States’ deficit.
Investors have been spooked by the threat of renewed inflation, which is being sustained by consistently high oil prices. Market participants believe that central banks may be compelled to increase interest rates in the coming months to ensure that these price increases do not become entrenched in the broader economy.
How on earth are pension funds managing their liabilities right now? This must be causing absolute chaos behind the scenes.
Is the UK’s economic outlook really that weak compared to the US? Seems like we’re getting dragged down by global fears alone.
I remember when 6% felt like a warning shot. Now it’s just Tuesday. Things have changed, and not for the better.