Pegasus Capital

The £ 3mth LIBOR fix has been moving higher without any notion of change to BOE rate. As rates have been moving up generally, and there is always additional premium across the year-end turn, it is easy to overlook that higher credit risk is now appearing in the £ LIBOR fix. Market expectations for base rates over next 12 months have fallen back to zero, but £3m LIBOR is at a new cycle high of just above 0.9%

£3Mthfraois
£3M Libor 06Dec18

PegasusCapital - 06/12/2018

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A View From The Bridge - May 2020 (2)

The risks of a deflationary outcome remain very elevated. Our understanding of likely household responses is becoming more informed, particularly with regard to genuine uncertainty, precautionary savings balances being built (where possible) and the likely consolidation of credit related debt. Turning the tide on the risk of viral infection and saving lives is the driving policy of government, but by definition this just pushes another rising tide of shrinking demand onto the economy.

PegasusCapital - 07/05/2020