Having wrong-footed markets at their latest meeting, Governor Andrew Bailey is in danger of joining the unreliable boyfriend club and not taking opportunities to normalise when markets are expecting him to i.e. without causing undue volatility, which surely is a Central Bankers job. Inflation concerns remain very much to the fore as wage costs spiral and there is now a school of thought, gathering momentum, that the push for ESG is causing inflation to become structural and therefore embedded and not transitory.

October was a busy month amongst the volatility in rates and the primary market remained active in sterling although not necessarily always offering value. We bought the new Tesco Sustainable 7-year, which priced at the very tightest it could, causing some orders to be pulled but still attracted a substantial book. We switched out of their ‘brown’ 2T 30’s and also sold our last long dated issue the Eversholt Funding 2040’s. Rothesay Life came to market and we switched out of their 6.875’s Perp into their new 5% Perp. We took profits in some airport paper; selling our Gatwick 2H 30’s and our Heathrow funding 28’s for a 35bp spread profit.

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Please also note the value of investments and the income you get from them may fall as well as rise, and there is no certainty that you will get back the amount of your original investment. You should also be aware that past performance may not be a reliable guide to future performance.