The yield on the UK 10-year government bond remains steady above 5% as Hilliard is unexpectedly appointed as Chancellor of the Exchequer.

⑴ The UK 10-year government bond yield remained steady above 5%, unchanged from the previous day. Prime Minister Andy Burnham unexpectedly appointed former Defence Secretary John Healey as Chancellor of the Exchequer. Although this was not the market’s favored candidate, it may signal an increase in future defence spending. ⑵ On the policy front, Burnham has so far pledged to fund cuts in energy bill taxes by ending the digital ID card program. According to data from the UK Office for National Statistics, government borrowing in June reached 16 billion pounds, down by one third year-on-year and below expectations. ⑶ Another report shows that, in the three months ending May, wage growth slowed to 4.3%, slightly below expectations, while the unemployment rate held steady at 4.9%. Investors are also monitoring developments in the Middle East, as recent escalations have given rise to new hopes in US-Iran diplomacy.