UK gilts yields and sterling jump on Brexit-breakthrough hopes

UK government bond yields climbed sharply on Wednesday amid widespread reports of a breakthrough in Brexit talks. Sterling also consolidated its gains.

The yield on 10-year gilts was at 1.32%, a jump of over 5% on the session. Bond yields move inversely to prices.

Sterling, meanwhile, was 0.52% higher against the dollar and 0.5% up versus the euro as at 1108 GMT.

There were widespread reports across the UK media on Tuesday evening that the UK had agreed to take as much as £100bn in EU related liabilities.

Impediment

The so-called Brexit divorce bill has been viewed as a major impediment to progress in Brexit talks between the UK and EU this year.

In recent weeks, the UK government has appeared increasingly desperate to secure agreement from the EU to progress talks to post-Brexit trade with Europe, as it seeks to head off a fierce backlash from business groups and mainstream UK politicians.