Tuesday 16 July 2019

Irish UK bond value rises

The value of holdings of British government bonds held by Irish residents rose by 11.4pc by the third quarter of last year to €255bn, or 40pc of the total holding by Irish residents of government bonds. Stock photo
The value of holdings of British government bonds held by Irish residents rose by 11.4pc by the third quarter of last year to €255bn, or 40pc of the total holding by Irish residents of government bonds. Stock photo

The value of holdings of British government bonds held by Irish residents rose by 11.4pc by the third quarter of last year to €255bn, or 40pc of the total holding by Irish residents of government bonds.

The move came despite the rising risks of a cliff-edge Brexit, which could cause losses to any holder of sterling denominated bonds as the pound could fall as much as 10pc in reaction to a cliff-edge exit, according to central bank forecasts.

There are just 50 days to strike a Brexit deal that would avert the UK falling out of Europe without a deal.

The total value of securities held by Irish residents was €2.93bn.

Overall, Irish corporate and government debt held by households stood at €83bn. Euro-area debt excluding Ireland held by them stood at €417bn, according to the Central Bank of Ireland.

Holdings of quoted shares increased by 14.8pc to almost €865bn over the past year. In a separate release, the Central Bank of Ireland estimated that non-resident holdings of Irish bonds stood at €74.6bn out of a total of €131.2bn in December 2018.

Within the next five years, €49.3bn of government bonds will mature. Of this, €30.2bn will mature in the next three years. Non-residents hold 59.6pc of bonds maturing within the next five years, the Central Bank said.

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