The rapid rise in the 30-year gilt yield has lifted it to a 20-year high but, while striking, so far the speed of the increase is slower than in the run-up to the liability-driven investment crisis after last September’s “mini-budget”. Even if the bond market sell-off were to subside without any financial casualties, it’s already exacerbating the impact of higher interest rates. That strengthens our view that a mild recession is around the corner, if not under way already.
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