After yesterday's debacle in the bond maket, here is what happened to 5 year Gilts:
Though the BoE intervened to stabalise 30-year gilts (to help pension schemes), they didn't intervene in the 5 year market.
And mortgages fixed for 5 years are backed by 5 year gilts as you can see from the blue line in the graphic.
The only strategy left to homeowners is to hope rates come down before you have to renew your fixed rate mortgage. In the meanwhile overpay as much as possible, so that even if rates don't come down at least they'll be applied to a smaller loan.
But what a mess. What an effing mess.
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