Investing.com - British government bond yields fell to fresh records on Friday after the U.K. voted to exit the European Union in a referendum result that roiled global markets, triggering a widespread flight to safety.
U.K. sovereign bonds, known as gilts, were being bid up, pushing the yield on benchmark 10-year bonds down 35 basis points to a record low of 1.02% amid fears over the long-term implications of Brexit on the global economy.
Yields move in the opposite direction of prices.
The rally in gilts came despite the growing likelihood that Britain’s credit rating will be downgraded in the aftermath of the referendum result.
Ratings agency Moody's said on Friday that the vote to leave the EU was "credit negative" for Britain's sovereign ratings.
"This outcome heralds a prolonged period of policy uncertainty that will weigh on the UK's economic and financial performance," it said in a statement.
Moody's rates the UK one notch below triple-A with a stable outlook.
The yield on U.S. 10-Year Treasuries dipped to a four-year low of 1.41% and the yield on Germany 10-Year Bunds reached a record low of minus 0.15% as investors scrambled into safe haven assets.
Falls in bond yields came as global stocks tumbled.
London’s FTSE 100 index was last down 5.19%, France’s CAC 40 lost 8.5% while Germany’s DAX was down 7%.