UK gilts slump despite lower-than-expected September services PMI

The United Kingdom’s gilts slumped during European session Wednesday after the investors have largely shrugged-off the country’s services PMI for the month of September that missed market expectations, also falling from the previous reading in August.

The yield on the benchmark 10-year gilts, climbed nearly 1-1/2 basis points to 1.541 percent, the super-long 30-year bond yields rose 1 basis point to 1.903 percent and the yield on the short-term 2-year also traded 1 basis point higher at 0.804 percent by 10:00GMT.

The seasonally adjusted IHS Markit/CIPS UK Services PMI Business Activity Index posted

53.9 in September, down from 54.3 in August. However, the latest reading was still above the 50.0 no-change value and slightly stronger than the average in 2018 so far (53.6).

Higher levels of business activity were attributed to a solid increase in new work and competitive pricing strategies during September. Survey respondents noted that Brexit concerns among clients and heightened economic uncertainty remained the main constraints on growth.

Meanwhile, the FTSE 100 rose 0.14 percent to 7,484.75 by 10:05GMT, while at 10:00GMT, the FxWirePro's Hourly Pound Strength Index remained slightly bearish at -81.709 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex