UK bonds, stocks surge as BoE keeps rates on hold

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LONDON, Nov 2 - British bonds were on track for their best day in more than a month on Thursday and stocks jumped after the Bank of England held interest rates steady for a second consecutive meeting.

The BoE left borrowing costs unchanged at 5.25% and published forecasts which showed the British economy was likely to skirt close to a recession and flat-line in the coming years. Yet Field said Thursday's rally in bonds only went some way to undoing the sharp sell-off that has pushed yields to around their highest level in decades.

Traders in derivatives markets on Thursday briefly moved to fully price in a BoE rate cut in August 2024, although later dialled that bet back slightly. They see two rate cuts by the end of next year, according to LSEG data.

 

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