Over the quarter, long dated Real and Nominal Gilt yields increased by at least c.30bps, for the longest maturities the increase was as high as c.50bps.
We continue to observe higher inflation prints and the economic outlook remains uncertain. In this environment, secure income real assets are increasingly attractive to investors seeking long-dated, inflation-linked income to meet liabilities and diversify their portfolios.
Yields on Nominal and Real Gilts substantially increased across all maturities over Q2 2023. Nominal rates increased by c130bps at 5Y maturity while at longer maturities increases were between 60 to 80bps.
Real Gilt yields decreased c.26bps across the curve. The change in Nominal Gilts yields was more varied across maturities. The short end (3Y) remained broadly unchanged.