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4 April 2023 last updated

Yields lower by 34 basis points with fear of contagion from bank bailout

Gilt yields fall 34 basis points
Standard rates:  
annuity rates change 3.21%
Enhanced rates:  
annuity rates change 3.10%
Gilt yields:  
annuity rates change 34 basis point
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15-year gilt yields chart - Based on figures for March 2023
Latest gilt yield chart

Annuity Rates UK - March 2023 review

Providers reduce annuity rates by 3.2% after the bank crisis sees the bailout of American SVB bank and European Credit Swiss bank.

Fear of contagion with other banks resulted in 15-year gilt yields reducing by 34 basis points from 4.13% and ending March at 3.79% as investors moved to safe havens.

Find related news here:
Gilt yields rise 43 basis points as investors expect higher base rates
Pension annuities could rise 4pc as Fed more hawkish with inflation

Providers of standard annuities reduced annuity rates by an average of -3.21% for this month and we would expect rates to rise by +0.68% in the short term if yields remain at current levels.

For smoker and enhanced annuity providers have reduced their rates by an average of -3.10% and we would expect rates to rise by +0.69% in the short term if yields do not fall.

Fig 1 below shows the annuity rates changes for the whole market and the proportion that have either increased, decreased or or did not change. It also shows the range of the changes of the annuity rates over the last month:

Annuity Rates Changes
Increase No change Decrease
annuity rates decrease   0%
annuity rates no change   0%
annuity rates decrease   100%
Increases of:
max 0.0%


Decreases of:
max -7.5%

  Fig 1: Annuity rate changes for the whole market

For the month 0% of annuity rates increased by up to 0% with 0% remaining unchanged and 100% decreasing by as much as to -7.5%.

What happened to standard rates

Below shows a fund of £100,000 with the change in standard annuity rates for single and joint pensioners from age 55 to 75 with different annuity options such as level or escalating over 1 month compared to gilt yields:

Standard annuity 1 month changes
Fig 2: Change in standard rates last month compared to gilt yields

What happened to enhanced rates

Lifestyle smoker and enhanced annuities have decreased significantly across the board for all types of annuities and ages.

Enhanced annuity 1 month changes
Fig 3: Change in enhanced rates last month compared to gilt yields

For the latest updates see Annuity Rates Review.

Changes to the 15-year gilt yields

The yields change for the month from 4.13% to 3.79% or -34 basis points. Table 1 below shows the daily 15-year gilt yields and the increase or decrease from the previous day's close:

15-Year Gilt Yields - March 2023
Day Rate (%) Change (bp*)
1 4.17 +3
2 4.20 +3
3 4.18 -2
6 4.18 0
7 4.13 -5
8 4.08 -5
9 4.10 +2
10 3.93 -17
13 3.73 -20
14 3.84 +11
15 3.67 -17
16 3.76 +9
17 3.65 -11
20 3.70 +5
21 3.74 +4
22 3.81 +7
23 3.71 -10
24 3.64 -7
27 3.71 +7
28 3.79 +8
29 3.79 0
30 3.83 +4
31 3.79 -4
  Table 1: Daily 15-year gilt yields and changes
* bp - basis points
News related stories:
Gilt yields reduce 32 basis points with concerns for global growth
Annuity rates up 42pc last year and record levels of retirement income
Annuity Rates
  Age Single Joint  
  55 £5,736 £5,481  
  60 £6,132 £5,880  
  65 £6,860 £6,462  
  70 £7,678 £7,215  
£100,000 purchase, level rates, standard
Unisex rates and joint life basis
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