The news that Prime Minister Liz Truss will hold a press conference on the economy later today sent UK government bonds climbing.
The bonds are issued by the government to raise money and in return, it pays interest on them. The higher the price of the bonds, the lower the interest rate it pays, known as the yield.
The bond price fell after September’s mini-budget, causing yields to climb to their higher level since the financial crash in 2008, as investors demanded higher returns to lend to the UK.
Yields on 30-year UK bonds hit 5.17% on 28 September in the aftermath of the mini-budget. Today’s news sent them tumbling to as low as 4.22%.
However, that’s still some way above the level they were at the day before the mini-budget on 23 September – then they stood at 3.59%.
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Source: BBC.com