October 7, 2016 / 11:43 AM / 9 months ago

Market gauge of British inflation highest since at least end 2013

2 Min Read

LONDON (Reuters) - A market measure of long-term British inflation rose on Friday to its highest level since the end of 2013 at least as sterling took a dive on growing anxiety that Britain will opt for a "hard" exit from the European Union.

On Friday, the pound tumbled about 10 percent from levels around $1.2600 to $1.1378 GBP=D4 in a matter of minutes in thin early Asian trade.

The currency's weakness, which increases the cost of imports, has fuelled expectations for higher inflation.

The five-year, five-year breakeven inflation forward, a measure of long-term inflation expectations in Britain, rose to around 3.64 percent GBIL5YF5Y=R at 0833 GMT -- one of its highest levels since late 2013, according to Reuters data.

At 1148 GMT the forward stood at 3.58 percent.

British gilt yields also rose sharply.

The 10-year gilt yield GB10YT=RR was up 21 basis points this week at 0.96 percent and on track for the biggest one-week rise since August 2015.

Reporting by Dhara Ranasinghe, editing by David Milliken

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below