UK gilts steady after September consumer inflation matches expectations; investors eye BoE Governor Carney’s speech

The UK gilts slumped Tuesday after the country’s consumer price-led inflation index for the month of September met market expectations, and coming in higher than the previous reading in August.

The yield on the benchmark 10-year gilts, traded steady at 1.34 percent, the super-long 30-year bond yields flat at 1.88 percent and the yield on the short-term 2-year also hovered around 0.45 percent by 09:30 GMT.

Inflation in Britain has hit 3 percent for the first since early 2012, official figures showed Tuesday - a development that reinforces expectations that the Bank of England will raise interest rates next month for the first time in a decade.

The Office for National Statistics said consumer price inflation was 3 percent in the year to September, up from the previous month's 2.9 percent. The increase, which brings the rate to its highest level since March 2012, was widely anticipated in the markets.

Meanwhile, the FTSE 100 traded 0.05 percent higher at 7,531.75 by 09:30 GMT, while at 09:00GMT, the FxWirePro's Hourly Pound Strength Index remained slightly bullish at 64.08 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex

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