Gilt yields hit post-Brexit highs
British gilt yields surge to a post-Brexit peak after UK GDP data, while sterling drops against the dollar and the euro
London — British gilt yields surged to a post-Brexit peak on Thursday, after data showed the economy had grown faster than expected in the third quarter, reducing the chances of an interest rate cut in the near term. The benchmark 10-year gilt yield rose 10 basis points to 1.27%, the highest since the Brexit vote in June, dragging other European government bond yields higher. It did little, however, to lift sterling, which fell against both the dollar and the euro. British gross domestic product (GDP) expanded by 0.5% in the July-September period, less rapid than the unusually strong growth of 0.7% seen in the second quarter, but comfortably above a median forecast of 0.3% in a Reuters poll of economists. Compared with the third quarter of last year, growth picked up to 2.3%, the strongest pace in more than a year, according to the preliminary figures from the Office for National Statistics.
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