By Caitlin McCabe
Yields on U.K. government debt rose and the British pound strengthened against the dollar Thursday after the Bank of England signaled it is prepared to raise its key interest rate to curb inflationary pressures caused by the conflict in the Middle East.
-- U.K. bond yields jumped, especially at the short end of the curve. The two-year gilt yield jumped past 4.4%. The 10-year yield rose past 4.87%, hitting a 14-month high.
-- The pound modestly strengthened after BOE Gov. Andrew Bailey said he stood "ready to act as necessary to ensure inflation remains on track to meet the 2% target." It most recently rose 0.3% to $1.33.
-- Before the conflict started, the U.K.'s central bank had been expected to lower borrowing costs, but the U.K. economy is now likely to grow more slowly than the BOE forecast last month.
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(END) Dow Jones Newswires
March 19, 2026 08:41 ET (12:41 GMT)
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