British government bonds fall 1.7% amid budget deficit fears

UK gilts suffered their first annual loss in a decade last year amid worries about the government's budget deficits.

Investors in British government bonds saw a 1.7 per cent decline last year, the first since 1999, according to Bank of America Merrill Lynch figures.

That performance compares relatively well against the 3.5pc fall in US Treasuries over the same period.

British £20 notes

The British pound saw its first annual gain against the dollar and euro since 2006

But it is poor when set against the 1.9 per cent gain recorded by German bonds.

However sterling saw its first annual gain against the dollar and the euro since 2006, as it recovered some of its 2008 declines.

The pound rounded off the year at $1.61 and €1.12.


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