UK gilts jump after unemployment rate worsens beyond expectations in December

The UK gilts jumped Wednesday after the country’s unemployment rate for the month of December came in worse than market expectations, leading investors to flock into safe-haven instruments. Markets will now focus on Bank of England (BoE) Governor Mark Carney's speech and the Inflation Report Hearings following that, due by 14:15GMT.

The yield on the benchmark 10-year gilts slumped nearly 4 basis points to 1.55 percent, the super-long 30-year bond yields plunged 3-1/2 basis points to 1.93 percent and the yield on the short-term 2-year traded 2 basis points lower at 0.65 percent by 09:30GMT.

The unemployment rate ticked up to 4.4 percent in the three months to December, up from 4.3 percent, a four-decade low. The number of people out of work rose by 46,000 to 1.47 million.

Britain’s basic pay rose by 2.5percent per year in the three months to December, the Office for National Statistics reports. That’s up from 2.4 percent in the previous month. Pay including bonuses also rose by 2.5 percent in the quarter - unchanged from last month.

Meanwhile, the FTSE 100 traded 0.16 percent lower at 7,234.50 by 09:35 GMT, while at 09:00GMT, the FxWirePro's Hourly Pound Strength Index remained neutral at -41.33 (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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