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UK credit default swaps hit fresh 27 month high

Published 09/07/2022, 04:46 AM
Updated 09/07/2022, 04:51 AM
© Reuters. FILE PHOTO: Pound banknotes are seen in this illustration taken March 1, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
SPGI
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LONDON (Reuters) - The cost of insuring exposure to Britain's sovereign debt rose by 2 basis points on Wednesday, hitting levels last seen in June 2020 when markets were recovering from the COVID-19 rout, after Liz Truss took over as prime minister.

Five year credit default swaps climbed to 27 bps after closing at 25 bps on Tuesday, data from S&P Global (NYSE:SPGI) Market Intelligence showed.

© Reuters. FILE PHOTO: Pound banknotes are seen in this illustration taken March 1, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

Markets had greeted the arrival of Truss on Tuesday with the sharpest sell-off of long-dated UK government debt since the COVID-19 pandemic, with 10-year yields hitting their highest since 2011 at around 3.15%.

Truss vowed to take immediate action to tackle one of the most daunting set of challenges for an incoming leader in Britain's post-war history led by soaring energy bills, looming recession and industrial strife.

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