UK bonds lead global markets in August

British corporate bonds beat global counterparts last month as investors gained confidence in the UK's economic recovery.

UK corporate debt denominated in all currencies returned 3.25% last month, the most in a year. It was also the best among the 10 countries making up almost 90% of the $6.2trn Bank of America Merrill Lynch Global Broad Market Corporate Index, Bloomberg reports. Santander's Abbey National and supermarket giant Tesco led the gains, returning as much as 12.7%. The spread for UK corporates over benchmark government bonds narrowed four basis points to 237 in August, compared to a six basis point rise for US company debt. UK government bonds also rallied strongly, returning 4.7% last mont...