© Reuters. FILE PHOTO: Workers emerge from Bank underground station with the Bank of England (L) and Royal Exchange building (R) seen in the City of London financial district, London, Britain, January 25, 2018. Picture taken January 25, 2018. REUTERS/Toby Melville
LONDON (Reuters) – The yield on two-year British government bonds hit their highest levels in over two weeks on Friday, a day after the Bank of England spelled out plans for a “modest” reversal of its huge stimulus to support the economy through the COVID-19 crisis.
The two-year gilt yield rose by more than two basis points to a high of 0.117%, its highest since July 22.
Rate futures suggested investors were pricing in a first 15 basis-point rise to take the BoE’s benchmark Bank Rate to 0.25% around May next year. Before Thursday’s announcement by the central bank, rate futures pointed to a hike in August 2022.
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