Gilt Yields Reach Six-Month High as Inflation Tops Forecasts

U.K. government bonds fell for a third day as a report showed British inflation remained above the government’s 3 percent limit last month, damping speculation the Bank of England may extend its bond-purchase program.

The decline drove the yield on the 10-year gilt to the highest level in six months after data from the Office for National Statistics showed consumer prices rose 3.3 percent from a year earlier after a 3.2 percent increase in October. That’s the highest since May and exceeded the 3.2 percent median forecast of 33 economists in a Bloomberg survey. The U.K government plans to sell 3.5 billion pounds ($5.5 billion) of securities maturing in January 2016 tomorrow.