(Bloomberg) -- UK bond investors are the most bullish in over a decade, lured by elevated yields before the Bank of England's expected switch to monetary easing, a JPMorgan Chase & Co. survey shows.
Sterling funds increased their long duration exposure to the most relative to the benchmark since at least 2010, strategist Matteo Mamprin wrote in a note to clients dated Thursday, citing a survey conducted the day before among European real money investors. About 84% of UK single-currency funds currently hold long positions, the survey found.
Gilts have had a rocky start to the year, with UK yields rising more than their European and US peers to trade above 4%. Governor Andrew Bailey said last week that bets on rate reductions this year are “not unreasonable,” but added that when and by how much policy is eased depends on further progress being made on tackling sticky inflation.
Money markets are pricing at least two Bank of England rate cuts this year with more to follow in 2025.
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