The Great British gilt trip: Do not rush into buying yet

Still some opportunities

The Bank of England is starting to sell government bonds in a bid to reduce its emergency stimulus to the UK economy.

In recent months, besides the question "What is happening in British politics?", another important one has been "Is it time to buy?". The price of ten-year gilts dropped by 20% in just two months, causing onlookers to draw comparisons between the UK and an emerging markets economy. Bloomberg indices reported that UK gilts had seen losses three times the size of their emerging market equivalents since July. But the general expectation was that the situation in the UK, as the world's fifth-largest economy, would stabilise and improve - which would make the drop in gilts a bargain. Ho...