UK two-year gilt yields hit highest since June 9 after hot inflation data

British two-year government bond yields - which are sensitive to speculation about Bank of England interest rates - rose to their highest level in more than two months on Friday.

The yields on two-year gilts, which rise when the price of the bonds falls, climbed about three basis points to a session peak of 3.999%, the highest since June 9.

Data published earlier this week showed inflation in Britain rose to 3.8% in the 12 months to July, pushing back expectations for when the BoE is likely to cut borrowing costs again.


Investors were fully pricing a next rate cut by the central bank in April next year, according to LSEG data.