Is the great bull run in gilts finally over?

GILTS

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UK gilts have had a monumental run over the last few years as investors piled into safe havens to shield them from the turbulence of equity markets.

Yields fell to record lows this year as a result, with the yield on the benchmark 10-yr gilt dropping as low as 1.43%. This is in stark contrast to a decade ago when 10-yr gilts yielded around 4.59%, and then peaked at 5.42% in June 2007. However, the credit crisis and the resulting recessions in major economies around the world changed everything, with yields tumbling since this peak. In July this year the average monthly yield on 10-year gilts reached a record low at 1.55%. However, there has recently been a move upwards in yields as investors take profits from a trade that ha...

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