The yield on UK 1o-year gilts fell yesterday to a low of 2.76 per cent – amid huge demand from investors – to its lowest level for half a century.
Its a trend which was hailed by George Osborne’s spokesman as proof that the chancellor’s austerity measures are working, as we reported this morning.
“This is proof that we are now seen as a safe haven, we’re not seeing the increase in yields seen in Europe and the US,” he said.
“It’s a vote of confidence, one of the key aspects of our plan has been a tight fiscal policy combined with a loose monetary policy, it’s the right mix for economic growth, and the need to rebalance towards exports and away from consumption.”
We wrote last September about how low yields meant lower interest Read more