Foreign Investors Selling UK Bonds in January at Fast Pace

Foreign investors sold British government bonds in January at the fastest pace in nearly three years, probably reflecting how funds are adjusting gilt holdings after a buying spree late last year rather than nerves about Brexit, analysts said.

Overseas investors sold a net 7.59 billion pounds of gilts in January, the biggest monthly drop since March 2014 and following on from 2.97 billion pounds of sales in December, Bank of England data showed on Wednesday.

The central bank is watching closely for signs that foreign investors – responsible for plugging Britain’s big current account deficit – are starting to shy away from British assets as the process of leaving the European Union gets underway.

January’s outflow scythed the rolling three-month total purchases from foreign investors down to 5 billion pounds. Two months ago that measure stood at 39.43 billion pounds, the highest since BoE records began in 1986.

via Reuters

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