Tumbling Bonds Add to U.K. Woes

Just two weeks into October, U.K. government bonds are already set for their worst month since February 2015. The pound’s plunge since the nation voted to exit the European Union has pushed up the outlook for inflation and damped bets the Bank of England will be able to introduce more stimulus, delivering a double blow to the debt. The benchmark 10-year gilt yield, which fell to a record-low in the wake of the referendum, has climbed more than 30 basis points this month, while the Bloomberg U.K. Sovereign Bond Index has dropped 2.3 percent.

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