Bonds: Gilts advance as Carney announces intention to stay

These were the movements in some of the most widely-followed 10-year sovereign bond yields:

US: 1.83% (-1bp)

UK: 1.25% (-2bp)
France: 0.47% (0bp)
Germany: 0.16% (0bp)
Spain: 1.20% (-3bp)
Italy: 1.66% (+8bp)
Portugal: 3.32% (-2bp)
Japan: -0.05% (-1bp)
Greece: 8.29% (-10bp)

Longer-dated Gilts were among the best performers at the start of the week after Bank of England governor Mark Carney said he would stay at his post until 2019, instead of leaving in 2018 as some had speculated over the weekend, "to contribute to securing an orderly transition to the UK’s new relationship with Europe”.

Going the other way was similarly-dated debt issued by Rome.

Over the weekend, a Demos & Pi poll published by La Repubblica on 30 October, showed that 39% of the country´s voters were against the constitutional reforms proposed by prime minister Matteo Renzi, versus the 35% who were in favour.

In US macro news, personal income and spending were slightly weaker than expected in September if revisions to data for the previous two months are taken into consideration. Incomes rose 0.3% on the month, while spending was ahead by 0.5%, Department of Commerce said. Economists forecast rises of 0.4% and 0.5%.

The headline price deflator for personal consumption expenditures rose by 0.2% over the month and by 0.1% at the 'core' level.

Similarly, factory activity in the Great Lakes area got off to a weak start in the fourth quarter, the results of a widely-followed survey showed.

MNI's Chicago manufacturing sector purchasing managers´ index declined by 3.6 points to a five-month low of 50.6. Economists had forecast a reading of 54.0.

Across the channel, Eurozone inflation rose an annualised 0.5% in October, after a 0.4% rise in September, as expected. It remained below the European Central Bank's near-2% target.

Euro area gross domestic product in the three months to end-September edged up 0.3% on-quarter and 1.6% on the year. Both were unchanged from second quarter and were in line with estimates.

"The preliminary flash estimate of Eurozone third-quarter GDP supports the message from earlier country data that the pace of growth remains fairly slow," said Capital Economics.