Rates expected to hold as rally remains fragile

Investec Guinness Flight is favouring the 10 and 11 year areas of the yield curve for Japanese government bonds in the expectation that the domestic recovery will strengthen. Paul Brain, head of retail fixed income at Investec Guinness Flight, says the group has sold out of five and six year Japanese government bonds and moved into the 10 and 11 year area of the curve. Overall, Investec Guinness Flight is marginally underweight Japanese government bonds. Five year Japanese government bonds are yielding 5% while yields are around 1.2% at the six year end of the curve. Ten year and 11 year ...