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19 May 2015
UK gilt yields fall on negative inflation
FXStreet (Mumbai) - The yields on the short duration and long duration gilts in the UK fell after the official data showed the CPI in April fell below zero levels for the first time since 1960.
Currently, the 10-year gilt yield trades 6 basis points lower at 1.892%, while the 30-year yield trades at 2.581%; down 4.9 basis points for the day. At the short-end, the 2-year yield, which usually mimics the short-term interest rate expectations, trades 2.7 basis points lower at 0.508%.
The the UK Office for National Statistics (ONS) data showed the inflation as measured by the consumer price index (CPI) fell 0.1% year-on-year in April, missing the estimate and the previous figure of 0%.
The yields were under pressure right from the start of the European session today due to the sharp weakness in the bond yields across Eurozone after the ECB policy maker indicated the bank may accelerate QE purchases in May and June.
Currently, the 10-year gilt yield trades 6 basis points lower at 1.892%, while the 30-year yield trades at 2.581%; down 4.9 basis points for the day. At the short-end, the 2-year yield, which usually mimics the short-term interest rate expectations, trades 2.7 basis points lower at 0.508%.
The the UK Office for National Statistics (ONS) data showed the inflation as measured by the consumer price index (CPI) fell 0.1% year-on-year in April, missing the estimate and the previous figure of 0%.
The yields were under pressure right from the start of the European session today due to the sharp weakness in the bond yields across Eurozone after the ECB policy maker indicated the bank may accelerate QE purchases in May and June.