Gilt yield and governme

cepheus

I have a saving/economic question here. If the government need to borrow money presumably the most likely way they will do this is through raising Gilt issues. Does this mean it will be a lenders market and Gilt yields will have to be higher to ensure they are fully subscribed? How does this relate to the anticipated downward trend in interest rates that implies that yields from bonds will be generally lower.

gozomark

cepheus wrote: »

I have a saving/economic question here. If the government need to borrow money presumably the most likely way they will do this is through raising Gilt issues. Does this mean it will be a lenders market and Gilt yields will have to be higher to ensure they are fully subscribed? How does this relate to the anticipated downward trend in interest rates that implies that yields from bonds will be generally lower.

it implies a steepening of the yield curve - ie

base rate and short end yield come down, 10 year and 30 year gilt rates go up

mr_fishbulb

Can't see the full article, but Investor's Cronicle are suggesting UK bank bonds are paying a higher yield than gilts and they will not be allowed to fail.

purch

UK bank bonds are paying a higher yield than gilts

UK Bank Bonds always yield higher than Gilt edged stock....

it implies a steepening of the yield curve

Parabolic !!!!!!!!

The far end and near ends of the yield curve operate totally seperately from each other. Cuts in Base Rate will often push up rates at the far end of the curve depending on circumstances.