UK 10-Year Gilt Yield Update
The UK 10-year gilt yield is showing a potentially interesting setup on the chart! A symmetrical triangle pattern appears to be forming, and a weekly close above 4.75% could confirm this formation, with a longer-term target up to 6.60%.
Recently, yields surged to 4.51%, the highest in a year, following reactions to the Labour government’s first budget. Key highlights include:
• 📈 £28 billion in increased borrowing per year across parliament.
• 💰 £297 billion in bond sales this fiscal year—second largest on record.
• 💸 £40 billion in new tax hikes, aimed at boosting funding for public services and covering a £22 billion fiscal gap.
The Office for Budget Responsibility adjusted GDP growth forecasts up to 1.1% for this year but revised down to 2% for 2025. Meanwhile, inflation is projected to average 2.5% in 2024, peaking at 2.6% in 2025, then easing to 2% by 2029.
The Bank of England is still expected to cut rates by 25bps this week, though traders now anticipate three quarter-point cuts by 2025's end (down from five last week).
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The information posted on Trading View is for informative purposes and is not intended to constitute advice in any form, including but not limited to investment, accounting, tax, legal or regulatory advice. The information therefore has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. Opinions expressed are our current opinions as of the date appearing on Trading View only. All illustrations, forecasts or hypothetical data are for illustrative purposes only. The Society of Technical Analysts Ltd does not make representation that the information provided is appropriate for use in all jurisdictions or by all Investors or other potential Investors. Parties are therefore responsible for compliance with applicable local laws and regulations. The Society of Technical Analysts will not be held liable for any loss or damage resulting directly or indirectly from the use of any information on this site.
Recently, yields surged to 4.51%, the highest in a year, following reactions to the Labour government’s first budget. Key highlights include:
• 📈 £28 billion in increased borrowing per year across parliament.
• 💰 £297 billion in bond sales this fiscal year—second largest on record.
• 💸 £40 billion in new tax hikes, aimed at boosting funding for public services and covering a £22 billion fiscal gap.
The Office for Budget Responsibility adjusted GDP growth forecasts up to 1.1% for this year but revised down to 2% for 2025. Meanwhile, inflation is projected to average 2.5% in 2024, peaking at 2.6% in 2025, then easing to 2% by 2029.
The Bank of England is still expected to cut rates by 25bps this week, though traders now anticipate three quarter-point cuts by 2025's end (down from five last week).
Disclaimer:
The information posted on Trading View is for informative purposes and is not intended to constitute advice in any form, including but not limited to investment, accounting, tax, legal or regulatory advice. The information therefore has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. Opinions expressed are our current opinions as of the date appearing on Trading View only. All illustrations, forecasts or hypothetical data are for illustrative purposes only. The Society of Technical Analysts Ltd does not make representation that the information provided is appropriate for use in all jurisdictions or by all Investors or other potential Investors. Parties are therefore responsible for compliance with applicable local laws and regulations. The Society of Technical Analysts will not be held liable for any loss or damage resulting directly or indirectly from the use of any information on this site.
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