UK gilts climb ahead of February retail sales, BoE member Broadbent’s speech

The UK gilts climbed Wednesday as investors wait to watch the February retail sales data and the Bank of England (BoE) member Broadbent’s speech, scheduled to be held on March 23. Also, today’s 10-year auction later in the day will provide further guidance to the debt market.

The yield on the benchmark 10-year gilts, which moves inversely to its price, plunged nearly 5 basis points to 1.20 percent, the super-long 30-year bond yields slumped over 4 basis points to 1.78 percent and the yield on the short-term 2-year traded 2 basis points lower at 0.12 percent by 09:30 GMT.

UK inflation surged above the Bank of England’s (BoE) 2.0 percent target for the first time in over three years in February, underscoring how consumer spending is likely to be increasingly squeezed by higher prices in 2017.

Official data showed inflation rising to its highest since September 2013. Consumer prices rose 2.3 percent on a year ago in February, according to the Office for National Statistics, the rate of inflation picking up from 1.8 percent in January and just 0.3 percent this time last year.

Meanwhile, the FTSE 100 fell 0.86 percent to 7,312.50 by 09:50 GMT, while at 09:00GMT, the FxWirePro's Hourly Pound Strength Index remained slightly bullish at 92.38 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex