For almost a year now this commentator has been a “reluctant Bull” in Fixed interest.
During this time 10yr UK Gilt yields (see Chart below) have fallen from circa 2.9% to 1.90% In Capital terms this equates to a rise in Price of circa 15 points!
The deflationary back drop recently exacerbated by poor Europe data could push yields even lower. The benefit of being “Systematic” allows me to just “follow the numbers” until told otherwise. The initial target is 1.76% but 1.46 % has also appeared on the radar? This raises the possibility of a return to the “Financial Crisis” low yield of 1.44% made in April 2013. Update to follow.