OMGI's Johnson: Be prepared for UK rate rise this year

Old Mutual Global Investors head of fixed income Christine Johnson has said Bank of England Governor Mark Carney may surprise markets by raising interest rates later this year, rather than the 2015 consensus.

Despite dovish comments from Carney last week raising the prospect of lower rates for longer, Johnson (pictured) said the first rise could come as early as the end of this year. "There is a decent chance we will get a rate rise later this year," she said. "Carney is signalling that if you are rate-sensitive, you need to think about how it will affect you." Johnson has been positioning her funds - the top-decile £474m Old Mutual Corporate Bond and £112m Monthly Income Bond funds - to mitigate against increasing M&A activity, which could harm the credit quality of involved companies. ...