Bank of America: European gilt buyers' duration exposure diverges from their outlook to a record degree, with evident signs of regret

智通财经2026/09/11 13:26

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Bank of America has pointed out that investors who have heavily bought European and UK government bonds in recent months may already be regretting this decision after a sharp sell-off in the bond market.
A survey by the bank showed that despite interviewees becoming more pessimistic about the interest rate outlook, they have increased and maintained their holdings of long-duration bonds since the beginning of August.
As soaring energy prices intensify inflation concerns, bond yields have risen sharply, and selling pressure in other global bond markets has further accelerated this trend.
Strategists including Ralf Preusser wrote in a report released on Friday that the divergence between investors’ views and their duration exposure in euro and pound bonds has reached a historical high, with evident buyer’s remorse.
They noted that this helps explain why UK gilts and German bunds have experienced such a degree of sell-off during the market’s repricing of central bank policy expectations this week, especially since most investors still believe the European Central Bank will have to reverse policy next year.
This divergence means that if yields continue to rise, pressure from mark-to-market losses on long-duration positions will become more pronounced, and subsequent attention will focus on whether the European Central Bank’s communications and energy price trends can ease the selling pressure in the bond market.

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Bank of America: European gilt buyers' duration exposure diverges from their outlook to a record degree, with evident signs of regret

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