Every week we give you our summary of happenings in the bond market.
It’s hard to add anything new to the waterfall of post-MTBPS commentary, so we immediately drew up a list of “silver-linings”. Understandably, the list is quite short, but a worthwhile exercise nonetheless. The one item that stands out is: “More realistic assumptions and estimates”. Although this will not take us far in the short term, it could potentially turn out to be a firmer foundation for improved government finances. A change in political will is one of the crucial elements to make it work though. Meanwhile, the sleepy international rating agencies are all awake. We remain of the opinion that the downgrade(s) should happen.