ECB announcement

UK bonds

UK Bonds: Gap between price and fundamentals widens

The UK real yields are likely to rise and close part of the gap with neutral rates. The analysts of AXA IM retain open long-volatility positions via options on Treasury notes. As they explain “sovereign bonds posted mixed performances over the month Since mid-September, European bonds have earned 0.6% and 0.5% respectively in UK and Germany, while US and Japanese bonds lost respectively 0.2% and 0.4%.”