The U.K government gilts were trading nearly flat on Monday as investors await for bank of England’s monetary policy meeting. The yield on the benchmark 10-year bonds, which moves inversely to its price stood unchanged at 1.426 pct and the yield on the 2-year bonds remained unchanged at 0.410 pct by 1235 GMT.
The Bank of England will announce its policy decision on Thursday, at 1100 GMT; markets largely expect that interest rates will be kept steady with a slim possibility of a surprise hike. But, the BoE has discussed with banks the prospect that it may cut interest rates in case of Brexit on the economy, which is slowing sharply ahead of the June vote, according to the Sunday Times. Meanwhile, this is consistent with rent poor economic growth which slowed to just 0.4 pct in the first quarter of 2016.
According to recent poll conducted by IPSOS concluded most of the respondents believe that a Brexit would lead to a domino effect in the European Union. Mainly, 48 pct of respondent voted that other European nations would also leave if British votes for separation and Europeans think Brexit will harm the EU more than the U.K. Moreover, 4 out of 10 said that they see a reduced European Union in next 4 years and 49 pct of those polled voted in favour of Brexit. Furthermore, 60 pct of Italians, 58pct of French & 42 pct of Germans think the UK will leave and 45 pct said that their own country should also hold a referendum.
On the other hand, in a latest EU referendum poll by ICM published in the Sunday Sun, the Brexit side leads by 46 pct to 43 pct and remaining 11 pct are still undecided. While 45 pct said that immigration in United Kingdom is the biggest factor in the vote.
Meanwhile, The FTSE 100 rose 0.25 pct or 15.30 points to 6,141 by 1230 GMT.
