Fixed Income  

Government bond sell-off gathers pace

Government bond sell-off gathers pace

The sell-off in government bond yields across the developed world gained momentum today as investors fled the so-called safe haven assets.

The yield on a 10-year German government bond, which moves inversely to price, has now risen from an intra-day low of 0.05 per cent on April 13 to a current level of 0.74 per cent.

The sell-off has been mirrored in both US and UK government bonds, with the yield on a 10-year UK gilt having risen from an intra-day low of 1.5 per cent on April 13 to surpass 2 per cent for the first time since November 2011.

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The sell-off has spread today into equity markets, with the FTSE 100 index today down by more than 1.5 per cent.