Is Carney powerless to affect gilt yields?

BOND SELL-OFF

As gilt yields soar in-line with US treasury yields, Dan Jones analyses whether the Bank of England's new boss really has much influence over the price of the country's debt.

The benefits of Mark Carney's forward guidance have been widely touted but, as yet, have had little impact on the direction of UK bond prices. As Investment Week reported earlier this month, bond managers and other investors expect an improving UK economy will force the BoE to backtrack on its commitment to hold base rates at 0.5% until 2016. Investors' scepticism over the Bank's ability to stick to that commitment has been blamed as a reason for falling UK gilt prices: yields on ten-year debt touched a two-year high of 2.75% last week. But the main driver of yields probably has mo...