Gilts Rise Third Day as Economy Shrinks, Investors Seek Safety
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Gilts advanced for a third day after a government report showed the U.K. economy shrank last quarter, boosting demand for the relative safety of Britain’s debt.
Ten-year yields dropped to the lowest level in eight weeks as Bank of England Deputy Governor Charles Bean said policy makers were ready to add more monetary stimulus. U.K. bonds also rose amid speculation Italy faces a political vacuum after 5 Star Movement leader Beppe Grillo said his lawmakers wouldn’t vote confidence in any government. Today’s gain means gilts have risen every day since Moody’s Investors Service cut Britain’s credit rating last week. The pound weakened versus the euro.