But with the Bank rate unlikely or unable to fall further, new home loan demand is shifting back to fixed-rate deals, rather than mortgages which track the Bank rate.

BBC: Mortgage lending 'rises slightly'

Demand for fixed income was also buoyed by a ZEW report showing that forward-looking sentiment among investors slipped in its April reading coming in at 7.6 after 14.1.

FORBES: Elevated Nuclear Fears Stoke Demand for Government Bonds

That manipulated, pegged, or fixed-rate system worked well in the early postwar years when there was apparently an unlimited demand for dollar reserves, which we were happy to provide to the world in the form of external deficits.

FORBES: Currency Manipulation

Market participants will demand higher returns to compensate for rising prices that eat away the value of fixed-income investments over time.

WSJ: Japanese Government Bonds Soar