UK to slash bond issuance by around 34 billion pounds

UK to slash bond issuance by around 34 billion pounds
UK to slash bond issuance by around 34 billion pounds   -   Copyright  Thomson Reuters 2021   -  
By Reuters

<div> <p><span class="caps">LONDON</span> – Helped by a faster-than-expected economic recovery and borrowing that has undershot forecasts, Britain’s government will slash its planned bond sales for the current financial year, a Reuters poll of primary dealers showed ahead of Wednesday’s budget.</p> <p>The median forecast from 12 primary dealers showed the Debt Management Office will plan to sell 218.8 billion pounds ($300.89 billion) of gilts in 2021/22, a 33.8 billion-pound reduction from its existing remit.</p> <p>Primary dealers, known in Britain as gilt-edged market makers, are banks hired by the government to help create a liquid market for its debt.</p> <p>The government has already sold 153.1 billion pounds of bonds in the current financial year, which began in April. </p> <p>It sold a record 485.8 billion pounds of gilts in the 2020/21 financial year to fund the economic response to the <span class="caps">COVID</span>-19 pandemic.</p> <p>The rebound in the world’s fifth-biggest economy means borrowing this financial year is likely to be around 40 billion pounds ($55 billion) below official forecasts.</p> <p>After hitting its highest since World War Two, at 15% of gross domestic product, in the year to March, the budget deficit in the current year looks to come in far lower than originally forecast. </p> <p>The poll showed government borrowing for 2021/22 looks set to come in at around 190 billion pounds – far less than the 233.9 billion pounds forecast in March by the Office for Budget Responsibility and compared with 247 billion in the 2020/21 financial year.</p> <p> <span class="caps">MEDIAN</span> 190.0 218.8 </p> <p> <span class="caps">MEAN</span> 189.9 218.5 </p> <p> <span class="caps">MAX</span> 211.7 232.6 </p> <p> <span class="caps">MIN</span> 160.0 200.0 </p> <p> <span class="caps">COUNT</span> 13 12 </p> <p> <span class="caps">PSNB</span>-ex Gilt </p> <p> (bln issuance </p> <p> stg) (bln stg) </p> <p> Barclays 182.0 212.6 </p> <p> <span class="caps">BNP</span> Paribas 211.7 230.8 </p> <p> Citi 173.0 207.6 </p> <p> Deutsche Bank 188.9 212.5 </p> <p> <span class="caps">HSBC</span> 194.8 220.6 </p> <p> <span class="caps">JPM</span>organ 160.0 </p> <p> Lloyds 185.9 219.6 </p> <p> Merrill Lynch 190.0 227.6 </p> <p> Morgan Stanley 194.0 230.0 </p> <p> NatWest 190.0 210.0 </p> <p> Nomura 185.0 200.0 </p> <p> <span class="caps">RBC</span> 209.0 232.6 </p> <p> Santander 199.0 218.0 </p> <p>($1 = 0.7272 pounds)</p> <p/> </div>