11/9/2018, 9:39 AM (Source: TeleTrader)
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German, UK bonds rally as traders abandon stocks

In the aftermath of the monetary policy update from the United States Federal Reserve, equities in Europe were hit on Friday and precious metals were mostly lower, leaving the safe haven role to benchmark sovereign debt securities. Amid strong losses in the Asian session for stocks, bonds issued by the governments of the United Kingdom, Germany advanced together with their counterparts from the United States, while the dollar rose moderately. Oil sold off. The Fed yesterday expressed the intention to continue with interest rate increases even though it noted a slowdown in business investment.

Germany's two-year note yielded a negative 0.594% at 9:36 am CET, a drop of 1.8 basis points for the day. The 10-year Bund yield was down 2.7 points at 0.433%, compared to a drop of 2.3 points to 1.063% for the 30-year bond. Corresponding futures added 0.02%, 0.22% and 0.49%, respectively. Bond prices move inversely to yields.

The yield on the British two-year notes fell 2.4 points to 0.817% and the gauge of the 10-year gilt lost 3.4 points to 1.398%. The 30-year bond yield fell 2.2 points to 1.959%.

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