Sterling bonds suffer worst quarter on record

Sterling-denominated bonds saw their worst quarter on record in Q2 of 2015, amid a fierce sell-off in German bunds and escalating worries over upcoming rate increases.

Bank of America Merrill Lynch's broad market sterling index, which includes both corporate and government bonds, showed sterling bonds lost 3.74% over the three months to the end of June. Total return for the year to date sits at -1.22%, with Q2 being the worst quarterly performance for the asset class since records began in 1999, the Financial Times reports. Bonds: Now is the time to take a defensive stance As the sell-off in bonds intensified, the quarter saw a sharp spike in UK and European yields, with investors preparing for potential rate rises in the US and higher inflat...