Franklin Templeton Sees 6% UK Bond Yields And Budget Reckoning

The UK’s struggle to fund spending will help drive the yield on 30-year gilts to 6%, according to Franklin Templeton’s David Zahn, reaffirming his bearish view of Britain’s public finances after last week’s budget.

While Chancellor of the Exchequer Rachel Reeves managed to boost the nation’s financial buffer, and largely keep markets on side, at the fiscal event, she relied on a raft of tax hikes that only kick in years from now. The budget also drew warnings from ratings agencies and think tanks about whether the plan is sustainable.