German and British bonds rose after the European Central Bank failed to assure investors that it was willing to spend billions of euros to contain the present turmoil in the bond markets.
Investors rushed to buy what they perceive as safer bonds, pushing up the price of the rock-solid German bund and Britain's gilts -seen as safer as the UK is outside the EU area, in control of its own monetary policy.
"We expect the governments to follow what they are committed to, they all have their adjustment and stabilisation programmes," ECB President Jean-Claude Trichet told journalists during a press conference in Frankfurt.
Investors had hoped that the ECB would announce a massive purchase of bonds in the market, stopping the Spanish, Irish and Portuguese debt from reaching unsustainable levels.
Gilt futures were down to 119.33 ticks, after having hit a session low of 119.06. Germany's bund futures rose to 127.02 ticks after Trichet's comments.
