M&G Investments bond manager Richard Woolnough has revealed he is currently favouring US treasuries over gilts, as the latter are already priced for more quantitative easing.
Woolnough, running a range of funds at M&G including the behemoth £5.3bn Optimal Income fund, said he was opting for treasuries instead of gilts as another round of quantitative easing was already expected by markets in the UK, but not in the US. "US debt is attractive versus gilts," he said. "In the UK, QE is priced in whereas it is not yet fully priced in in the US. Also, at some point if the UK economy continues to deteriorate, it will become bad for gilts, as there then becomes an element of credit risk." The US meanwhile is presenting signs of solid and sustainable growth, accord...
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