Jin10 data reported on August 18, the yield on UK long-term inflation-linked government bonds has surpassed the peak from three years ago when the bond market crashed, reflecting a continued decline in market demand for these types of bonds. The yield on 30-year inflation-linked government bonds briefly rose to 2.54%, the highest since 1998, exceeding the peak in September 2022, when former Prime Minister Truss's economic plan triggered a selling spree by leveraged pension funds. However, unlike the yield during the big dump in 2022, which skyrocketed from negative to historic highs in a matter of days (a one-day jump of 76 basis points), the recent rise has been a gradual accumulation. This trend indicates a decrease in demand from fixed income pension funds for these types of bonds, while investors are asking for higher compensation to take on long-duration risk.
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The yield on UK 30-year inflation-linked bonds has reached a new high since 1998.
Jin10 data reported on August 18, the yield on UK long-term inflation-linked government bonds has surpassed the peak from three years ago when the bond market crashed, reflecting a continued decline in market demand for these types of bonds. The yield on 30-year inflation-linked government bonds briefly rose to 2.54%, the highest since 1998, exceeding the peak in September 2022, when former Prime Minister Truss's economic plan triggered a selling spree by leveraged pension funds. However, unlike the yield during the big dump in 2022, which skyrocketed from negative to historic highs in a matter of days (a one-day jump of 76 basis points), the recent rise has been a gradual accumulation. This trend indicates a decrease in demand from fixed income pension funds for these types of bonds, while investors are asking for higher compensation to take on long-duration risk.