The United Kingdom’s gilts plummeted during European trading hours Monday as hassles over a Brexit deal since long has trouble investor sentiments to the core, so much so that European Union diplomats do not want to further extend the departure deadline beyond October 31.
The yield on the benchmark 10-year gilts, jumped 4-1/2 basis points to 0.722 percent, the 30-year yield sky-rocketed 7 basis points to 1.261 percent and the yield on the short-term 2-year gained surged 3 basis points to 0.573 percent by 11:05GMT.
Brexit will completely dominate the week in the UK, with few economic data of note. Public finances figures due tomorrow will show that net borrowing in September continued to trend higher than its level a year earlier on a trajectory incompatible with the Government’s fiscal rules, Daiwa Capital Markets reported.
And the CBI industrial trends survey due the same day will suggest that manufacturing activity remained weak this month with orders in retreat following renewed Brexit-related inventory accumulation, the report added.
UK Finance bank loan data for September, due Thursday, represent the only other UK release of note in the coming week. In the bond market, meanwhile, the DMO will sell 2025 Gilts tomorrow, Daiwa further noted in the report.
Meanwhile, the FTSE 100 remained nearly flat at 7,160.19 by 11:10GMT.


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