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6 Aug 2015
UK Gilt yields stay flat to negative ahead of BOE events
FXStreet (Mumbai) - The yields on the long duration and short duration UK gilts trade flat ahead of the BOE events, which are expected to show a major shift in the monetary policy.
2-yr yield weak despite hawkish expectations
The 2-yr yield is down more than one basis points at 0.642%, even though the BOE minutes are likely to show at least three policymakers in favour of a rate hike. Carney too is expected to sound hawkish at the press conference and could signal sooner than expected rate hike. The 2-year yield is widely believed to track rate hike expectations.
Meanwhile, the 1-year yield is down almost 2 basis points to 0.548%. The 10-yr yield is largely unchanged as well; trading around 1.968%. Moreover, the yield curve contradicts the widespread hawkish expectations.
2-yr yield weak despite hawkish expectations
The 2-yr yield is down more than one basis points at 0.642%, even though the BOE minutes are likely to show at least three policymakers in favour of a rate hike. Carney too is expected to sound hawkish at the press conference and could signal sooner than expected rate hike. The 2-year yield is widely believed to track rate hike expectations.
Meanwhile, the 1-year yield is down almost 2 basis points to 0.548%. The 10-yr yield is largely unchanged as well; trading around 1.968%. Moreover, the yield curve contradicts the widespread hawkish expectations.