Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

HSBC cuts year-end forecast for British gilt yields

Published 10/05/2018, 11:32
Updated 10/05/2018, 11:40
© Reuters. FILE PHOTO: The HSBC bank logo is seen at their offices in the Canary Wharf financial district in London

© Reuters. FILE PHOTO: The HSBC bank logo is seen at their offices in the Canary Wharf financial district in London

LONDON (Reuters) - HSBC said on Thursday it has revised down its year-end forecast for 10-year British government bond yields by 30 basis points to 1 percent, citing weaker-than-anticipated economic growth.

Britain's 10-year gilt yield is trading at 1.45 percent (GB10YT=RR), little changed ahead of a Bank of England monetary policy decision. The bank is expected to keep rates on hold.

"The economy has slowed more quickly than we had anticipated, and we now think further rate hikes are off the table for the foreseeable future," Daniela Russell, head of UK rates strategy at HSBC, said in a note.

"A weaker economic backdrop, alongside receding inflationary pressure, should support a fall in yields in the second half of the year."

HSBC became one of the few banks to erase its solitary UK rate hike call for 2018, saying at end-April that likely downward revisions to the BoE's growth forecasts in May would make it harder to justify a rate hike.

© Reuters. FILE PHOTO: The HSBC bank logo is seen at their offices in the Canary Wharf financial district in London

In its note on Thursday, HSBC said its downward revision for 10-year bond yields pushed the bank further below a consensus estimate of 1.80 percent.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.