UK gilts suffer after Q3 GDP remains expectedly unchanged ahead of long Christmas holidays

The United Kingdom’s gilts suffered during Friday’s afternoon session, after the country’s gross domestic product (GDP) remained unchanged, as per market expectations, during the third quarter of this year, released early today ahead of an upcoming long holidays owing to Christmas and New Year.

The yield on the benchmark 10-year gilts, jumped 2 basis points to 1.288 percent, the super-long 30-year bond yields rose nearly 1-1/2 basis points to 1.807 percent and the yield on the short-term 2-year traded nearly 2 basis points higher at 0.757 percent by 10:15GMT.

UK Q3 GDP growth was finalized at 0.6 percent q/q, unrevised. Annually, GDP grew 1.5 percent y/y, revised up by 0.1 percent. ONS noted that "services remained the strongest contributor to growth in the output approach to GDP in Quarter 3 2018, with growth easing slightly from the previous quarter; construction and manufacturing also contributed positively to growth".

At the same time, ONS also said "In comparison with the same quarter a year ago, the UK economy has grown by an unrevised 1.5 percent. This is a slight pickup from previous quarters in the year, although the longer-term picture remains one of relatively subdued growth compared with historic standards".

Meanwhile, the FTSE 100 slipped 0.86 percent to 6,658.00 by 10:30GMT, while at 10:00GMT, the FxWirePro's Hourly Pound Strength Index remained neutral at 48.041 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex