MFS Investment Management’s Benoit Anne says geopolitical considerations, rather
than domestic worries, are the primary driver of recent moves in UK gilt yields.
Investors are focused on the government’s economic plan and how it will be
funded; Anne says markets appear willing to give the new government some trust
so long as fiscal discipline is maintained. He expects this year’s budget to be
the key event, likely to reveal further details on measures and funding. At
publication, the UK 10-year gilt yield was up 2.6bps at 4.985%.
