International investors in record gilt buying

International investors are buying record amounts of gilts on expectations of further Bank of England quantitative easing.

Gilts have been in strong demand in recent months, with weak economic data in the US heightened fears of a double dip global recession. International investors bought £8.6bn in gilts in August, a 55% jump on the previous month, the Financial Times reports. The buying comes as the Adam Posen, an external member of the MPC, called on the Bank to restart QE to avoid a Japanese-style era of deflation. Yields on the benchmark 10-year UK government bond have climbed 1 basis point to 2.91% today. The it peaked at 4.27% in February