Nomura sees UK gilts as Europe’s most attractive bond bet
Nomura Asset Management is increasing its holdings of UK government bonds, arguing they offer better value than eurozone peers thanks to higher yields and improving domestic fundamentals, according to a Bloomberg interview with Yuji Maeda, head of global fixed income at the $646 billion fund.
Maeda said gilts remain the most compelling European debt investment, noting the Bank of England’s cautious pace of rate cuts and yields around 4.4% on 10-year maturities, compared with roughly 1.6% in Japan.
- added that the “worst is over for the UK”, with inflation easing and fiscal conditions set to strengthen as the government pursues spending cuts and possible tax increases in next month’s budget.
While Nomura and Amova Asset Management both hold slight overweights in gilts, Maeda cautioned that long-term risks persist, including fiscal challenges and lingering effects of Brexit. Still, he expects gilts to outperform over the next 6–12 months.
