Sterling, gilts yields rise on above-forecast UK inflation data

LONDON: Sterling hit session highs against the dollar and the euro, while gilt yields rose on Tuesday after UK inflation data came in higher than forecast.

The Office for National Statistics said on Tuesday that annual consumer price inflation was unchanged from August at 2.7 percent, confounding economists' forecasts for a slight dip to 2.6 percent.

The pound was up 0.1 percent and hit an intra-day high of $1.6010 from $1.5995 before the data. The euro was down 0.2 percent against sterling and hit the day's low of 84.69 pence, from 84.88 pence beforehand.

Ten-year gilt yields rose to 2.805 percent, their highest since Sept. 25 and more than 5 basis points up on the day, while gilt futures extended losses by more than 10 ticks on the data to hit a three-week low of 109.41, down 59 ticks on the day.