LONDON (Reuters) - British 10-year gilt yields hit their highest level since May on Monday as a deal between OPEC and other oil producers to reduce output pushed up inflation expectations and prompted investors to sell government bonds.
Mirroring moves in debt issued by Germany and other European countries, 10-year British gilt yields GB10YT=RR peaked at 1.508 percent according to Reuters data, the highest level since May 5 and up about 4 basis points on the day.
The 10-year yield has tripled from a historic low of around 0.5 percent in August when investors expected the Bank of England to cut interest rates to help offset the economic impact of the country’s decision to leave to the European Union.
Since then, the economy has performed much more strongly than expected and the BoE said last month it was moving to a neutral stance about whether its next move would be a rate cut or a hike.
Writing by William Schomberg; editing by John Stonestreet