UK gilts gain after Q3 GDP, Sep manufacturing production disappoints; employment report eyed

The United Kingdom’s gilts gained during European trading hours Monday after the country’s gross domestic product (GDP) for the third quarter of this year and the manufacturing production for the month of September disappointed market participants, while eyes still remain on the labour market report for the similar period, scheduled to be released on November 12 by 09:30GMT for further direction in the labour market.

The yield on the benchmark 10-year gilts, suffered nearly 2 basis points to 0.774 percent, the 30-year yield slipped nearly 1-1/2 basis points to 1.294 percent and the yield on the short-term 2-year traded tad 1 basis point down at 0.541 percent by 10:50GMT.

Britain’s Q3 GDP expanded 0.3 percent, returning to growth following a 0.2 percent contraction in the previous quarter, albeit slightly below market expectations of 0.4 percent growth. On a y/y basis, GDP grew 1 percent in the three months from July to September, down from 1.3 percent growth in the previous quarter and missing estimates for a 1.1 percent increase.

Further, the country’s manufacturing and industrial production both shrank on a m/m basis. The prior was down 0.4 percent, missing expectations for a 0.3 percent decline, while the latter fell 0.3 percent versus forecasts for a 0.2 percent fall.

Meanwhile, the FTSE 100 remained -1.10 percent down at 7,279.08 by 11:00GMT.