Sterling bond markets have fallen significantly since the beginning of the year. The fall has largel...
Sterling bond markets have fallen significantly since the beginning of the year. The fall has largely been caused by a revision both of interest rate expectations and of inflation expectations, as the economy has moved back into a growth period The move up in interest rate expectations has been dramatic. The Monetary Policy Committee of the Bank of England has already increased base rates by 25 basis points to 5.25% and the futures market is now discounting a series of base rate increases to a level in excess of 7% by the end of next year The rise in inflationary expectations, however, ha...
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