Aberdeen: Reeves provided the gilt market with all the right comforting words

Aberdeen: Reeves provided the gilt market with all the right comforting words

4 november 2025

Obligaties Verenigd Koninkrijk

Matthew Amis, Investment Director at Aberdeen Investments, comments on the ‘pre-budget’ speech by Chancellor Reeves:

'Chancellor Reeves’s speech this morning provided the gilt market with all the right comforting words as we head towards the Autumn Budget. The Chancellor confirmed the fiscal rules are ironclad, that she intends to increase the fiscal headroom and the importance of inflation falling.

She mentioned re-visiting welfare reform, and while admittedly there were more hints to tax rises than spending cuts, there were some hints to spending cuts nonetheless. Gilts yields fell throughout the speech, but pared gains as it became clear that even though tax hikes seem inevitable, they weren’t going to be announced today.

The question now is: can she deliver? UK chancellors have talked tough in the past, only to then fail on delivery or U-turn at the last moment. If Chancellor Reeves is as bold as she was this morning at the Autumn Budget, then we believe gilts yields can continue to fall into year-end, outperforming peers.'

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