The downbeat news on the UK economy this week did not stop the 10-year gilt yield rising further to its highest level since November 2015. And with CPI inflation set to climb further, perhaps to a peak of close to 10.0%, and the Bank of England growing more concerned that price expectations could become the-anchored from the 2% inflation target, it is becoming increasingly plausible that interest rates will rise further than the peak of 2.00% forecast by the consensus and the 2.75% peak priced into the financial markets. That suggests gilt yields may be some way from their peak yet.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services