UK bonds outperform eurozone counterparts

The introduction of the euro can be blamed for poor returns in eurozone bond funds relative to their...

The introduction of the euro can be blamed for poor returns in eurozone bond funds relative to their UK counterparts in the 40 months since the single currency's launch. According to Standard & Poor's, the eurozone bond funds achieved a total return of 8.13%, against an impressive 30.18% from UK fixed income funds, when both returns are denominated in euros, over the period from 1 January 1999 to the end of April 2002. There are two main reasons for the wide divergence in performance, S&P says. The first of these is the significant shift in foreign exchange rates which has seen a ...