PBR plans for gilts will harm non-financial corporate bonds, says Iggo

The glut of government bonds set to flood the market come with risks and could negatively impact non...

The glut of government bonds set to flood the market come with risks and could negatively impact non-financial corporate bonds, according to Axa IM's Chris Iggo. The CIO of fixed income cited his concerns following estimates that the Treasury will need to borrow £100bn per year to fuel the PBR proposals. Iggo says: "It is not clear that the bond market has the capacity to easily absorb all the increased government debt issuance as well as the government guaranteed bank issuance that is currently flooding the market. All this new Government paper has the potential to crowd out non-financ...