LONDON: The yield on 10-year British government bonds fell on Monday to its lowest level in nearly three months as investors assessed the challenge for the government the still lies ahead as it moves into the second phase of the Brexit negotiations.
After rising sharply on Friday after Prime Minister Theresa May secured a deal to move into the second phase of the negotiations, the 10-year yield fell 8 basis points to as low as 1.194 percent at 1548 GMT.
That was its lowest level since Sept. 14, the day the Bank of England stated its intention to raise interest rates in the coming months.
Britain's push to carve out a new British trading relationship with the EU contains many pitfalls and could widen differences over Brexit among her top team of ministers.
March gilt futures were up by more than 90 ticks shortly before 1600 GMT, compared with a 20-tick rise for comparable German bund futures.
The spread between 10-year British and German government bond yields tighthened by about 7 basis points on the day, more than wiping out the increase seen on Friday.
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