Hung parliament could see gilts lose their shine

UK government bond yields are likely to spike in the event of a hung parliament in the country’s general election on May 6, market analysts have warned.

“The expectation is that a hung parliament would be negative for gilts as it would be difficult to get agreement on how – and how quickly – the UK should deal with its deficit,” says Gary Jenkins, head of fixed income research at Evolution Securities. “Thus you could well see increased volatility and rising yields as we get nearer May 6 if the