UK Bonds Post Historic Gain as Sunak Victory Ends Policy ‘Chaos’
- Investors expect Sunak to mitigate damage of Trussonomics
- Two-year yield falls the most since 1993, BOE rate bets ease
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UK bonds posted some of their biggest gains on record as investors bet incoming Prime Minister Rishi Sunak will turn the page on weeks of turmoil dogging the nation’s markets and restore credibility to economic policy making.
Short-dated notes led the rally with the two-year yield falling by the most since 1993 after Sunak -- a former chancellor who had issued a warning over Liz Truss’s “fairytale” tax cuts -- emerged as the winner in the race to succeed her. The gains were supercharged as traders pared bets on future rate hikes.