Ahead of Bank of England Meeting, Don't Bet on U.K. Sovereign Bonds

In case anyone cares, the Bank of England will decide on interest rates tomorrow. Not that it can do much: Ahead of the general election on June 8, the only prudent decision would be to keep interest rates on hold at their record low 0.25%. That's a real -2.05% if we take into account inflation, which was 2.3% in March and April.

Even though this seems like a good thing -- after all, few people don't like low interest rates -- it does not bode well for fixed income, especially for U.K. sovereign debt assets. On Tuesday, the 10-year U.K. government bond yield rose, although it was softening a bit on Wednesday morning. Yields move inversely to bond prices....654 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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