Sterling and gilt yields plummet on surprise QE move

The benchmark 10-year gilt yield was at 2.36% prior to the announcement but fell to to 2.26% as the Bank raised its total asset purchase programme to £275bn. The pound fell 150 cents against the dollar from $1.545 to $1.53 and the FTSE 100 was up 2.3% at 5,219 on the news. Royal London's chief economist Ian Kernohan said the market was expecting governor Mervyn King would hold fire on more QE until next month, as data earlier this week revealing the UK services sector grew in September. "The BoE has decided to move ahead with QE slightly earlier than some of the market expected, an...