Chart of the day: Gilts turn the tide
After the Brexit vote, things have not been nearly as bad in Britain. The strongest gross domestic product of Group of Seven countries, a stable government with a decent majority, a historical victory at a local election on Thursday, plus a stable currency – these are not bad for a country predicted to go to hell in a handcart. As for interest rates, two-year British sovereign paper has been trading, unfazed, close to a record-low zero per cent since July. Now 10-year Gilts have turned the tide, with yields forming a double top against trend-line and Fibonacci retracement resistance. They are set to drop back to 50 basis points later this year.
Nicole Elliott is a technical analyst