UK gilts shrug-off worries over PM May’s leadership challenge amid renewed U.S.-China trade truce

The United Kingdom’s gilts fell during Wednesday’s afternoon session, shrugging-off worries over the country’s Prime Minister Theresa May’s leadership challenge that is scheduled for later today amid renewed optimism over the U.S.-China trade truce after months of fear and uncertainty.

Britain’s Conservative Party has announced that it will hold a no-confidence vote in her leadership today, which if lost by May, will lead to her dethrone and a fresh process will start to elect a new PM, which could further lead to anxiety and a no-deal Brexit by the March 29 deadline.

The yield on the benchmark 10-year gilts, jumped nearly 2-1/2 basis points to 1.211 percent, the super-long 30-year bond yields surged nearly 3-1/2 basis points to 1.755 percent and the yield on the short-term 2-year traded nearly 2 basis points higher at 0.704 percent by 11:10GMT.

The United States' President Donald Trump, in an exclusive interview to Reuters said that he is happy and pleased with the initial round of talks held with China on trade matters and would be delighted to hold a meeting with President Xi Jinping for a more detailed and comprehensive agreement.

Lastly, global crude oil prices were also on the rise after data from the American Petroleum Institute (API) showed a much bigger-than-expected fall of 10.18 million barrels in domestic crude stocks.

Meanwhile, the FTSE 100 jumped 1.16 percent to 6,885.50 by 11:20GMT, while at 11:00GMT, the FxWirePro's Hourly Pound Strength Index remained slightly bearish at -85.67 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex