U.K. Rates Markets Start Mapping Path to Higher Borrowing Costs

Investors should start preparing for higher U.K. borrowing costs, even if they take a while to materialize.

That’s the view of strategists at UBS Group AG and NatWest Markets, who recommended positions that would benefit from an increase in interest rates in a year or two.

While the Bank of England has signaled it will continue to support the economy with record-low interest rates and 150 billion pounds ($209 billion) of bond buying by year-end, the success of the U.K.’s vaccination drive has super-charged the recovery and plans for a full reopening in…