Fund managers are seeing opportunities in UK government bonds if Britain decides to leave the European Union later this month, with many expecting gilt prices to rally further in the event of a Brexit vote, following their strongest start to the year since 2001.
According to Thomson Reuters, the FTSE Gilts All-Stocks Total Return index was up 5.5% in 2016, making UK government bonds one of the best performing asset classes year-to-date. The yield on 10-year gilts fell to a near-record low of 1.39% last Monday, down from 1.96% at the start of the year. Investors have been flocking to gilts against a backdrop of growing concerns about the strength of the UK economic recovery and the impact of the EU referendum, which came to a head last week when Bank of England (BoE) governor Mark Carney warned a Brexit vote could result in a year-long recession....
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