Gilts tumble after Reuters reports BoE policy news
09.29.2009
Closed-door advice from the Bank of England that it had no plans to cut rates on bank reserves was a big market-mover, and Reuters was the place to get that news first. Economists briefed by BoE deputy governor Charles Bean on Sept. 29 told Reuters exclusively that he poured cold water on speculation that Britain would follow Sweden and try to jumpstart lending by lowering its reserve remuneration rate. Reuters reported the news 16 minutes before MNSI, 30 minutes ahead of Dow Jones and an hour before Bloomberg. Short-dated gilts and interest rate futures slid on the news and the yield curve flattened, with the two-year gilt yield climbing nearly 10 basis points in the 2-1/2 hours after the Reuters story appeared.
