London, Monday, 19 December 2022
Mid-December saw the UK 10-year Gilt yield hit 3.4%, the highest level since November 9th, as investors all over the world were alarmed by hawkish rhetoric coming from the US Federal Reserve and European Central Bank as well as an expanding bond market.
Fears that the world economy was heading into a deep recession were increased when policymakers in the US and Europe boosted interest rates by a half percentage point and indicated additional increases would follow.
The Bank of England announced the ninth consecutive half-point hike in interest rates on Thursday, but added that inflation had peaked, indicating that the current policy tightening may cease next year.
The UK CPI inflation rate decreased to 10.7% in November from a 41-year high of 11.1% in October, according to recent data, although it remained much above than the central bank's target of 2%.
(Report by: The decision Maker - Finance editors)