The UK’s rapid vaccine rollout combined with the global reflation story have lifted UK 10 year yields by 50bp in the past month, and there’s scope for more. If US yields push higher amid the Fed tapering debate, gilts could touch 1%. But a slower UK economic recovery, benign inflation outlook, and Brexit constraints imply the gilt sell-off has its limits Unsurprisingly Brexit will also be a long-term drag on UK rates. The trade disruption encountered over recent weeks will dissipate, but the root cause of it is largely not teething problems. Customs processes will continue to add costs for businesses and reduce ... (full story)