Dean Cook, multi-asset portfolio manager, Aviva Investors
One year on from the Mini Budget, evidence suggests the UK economy is slowing faster than its peers. This view is percolating into markets, best evidenced during July when June's inflation data was published.
CPI came in lower than expected, triggering a distinct flattening of the yield curve, contrary to prior months where inflation data implied no material slowing of the economy, and rates moved up in parallel.
Relative to other markets, it is likely the UK is closer to the biting point where higher rates cannot be sustained. After a difficult year, these changing circumstances have improved the outlook for gilts.
