United Kingdom GBP

United Kingdom 4-Year Treasury Gilt Auction

Impact:
Low

Latest Release:

Date:
Actual:
4.263%
Forecast:
Previous/Revision:
4.294%
Period:
What Does It Measure?
The United Kingdom 4-Year Treasury Gilt Auction measures the demand for and yield of government bonds with a maturity of four years. It primarily focuses on government borrowing costs and investor sentiment towards the UK economy, assessing areas such as fiscal stability and market confidence.
Frequency
The auction is held quarterly, with a typical release taking place at a specific date as announced by the UK Debt Management Office.
Why Do Traders Care?
Traders closely monitor the auction results as they influence the overall yield curve, affecting not just government bonds but also other assets including currencies like the GBP, corporate stocks, and even commodities. A successful auction with high demand typically reduces borrowing costs and is perceived positively by markets, while poor demand may signal economic concerns, impacting financial sentiment.
What Is It Derived From?
The auction results are derived from bids submitted by institutional and individual investors, where the final yield is determined based on competitive and non-competitive bids. The process involves setting a predetermined amount of bonds to be auctioned and analyzing the total demand to ascertain the yield, which reflects investor perceptions of risk and return.
Description
The auction is a key event in the UK’s fiscal calendar, as it not only sets the borrowing costs for the government but also serves as an indicator of investor sentiment regarding the country’s economic conditions. The results of the auction can signal changes in monetary policy expectations and affect market positions on interest rates.
Additional Notes
The 4-Year Gilt Auction serves as a coincident indicator of economic health, reflecting current investor sentiment towards UK government debt. Comparatively, its outcomes can be assessed against other maturities of gilt auctions to evaluate trends in demand and yields across different timeframes.
Bullish or Bearish for Currency and Stocks
Higher than expected: Bullish for GBP, Bullish for Stocks.

Legend

High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.

Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.

Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.

Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.

Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.

Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.

Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency

Green Number Better than forecast for the currency (or previous revise better)
Red Number Worse than forecast for the currency (or previous revise better)
Hawkish Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks.
Dovish Favors lower rates to boost growth, weakening the currency but lifting stocks.
Date Time Actual Forecast Previous Surprise
Mar 18, 2025
4.263%
4.294%
Feb 19, 2025
4.294%
4.384%
Jan 23, 2025
4.384%
4.499%