Sterling jumps, gilts add to losses after UK GDP

LONDON | Tue Oct 26, 2010 4:39am EDT

LONDON Oct 26 (Reuters) - Sterling rose broadly while gilt futures extended losses on Tuesday after a reading of UK economic growth for the third quarter came in stronger than forecast and dimmed the chance of more quantitative easing.

The Office for National Statistics said Britain's economy grew 0.8 percent between July and September, more than forecasts for a 0.4 percent rise. [ID:nAHLPLE68G]

The pound GBP=D4 hit the day's high of $1.5848, compared with around $1.5780 before the data.

The euro EURGBP=D4 fell to the day's low of 88.00 pence.

Dec gilt futures FLGZ0 extended losses by more than 20 ticks to stand at 124.09, down 71 ticks on the day, having traded 40 ticks down at 124.40 before the data.

Britain's FTSE 100 .FTSE showed little reaction to the data, down 0.7 percent at 5,713.75.

Bund futures FGBLZ0, which had fallen ahead of the release in anticipation of a stronger number, marked a session low of 129.28, 56 ticks lower on the day and their lowest in a month.

(Reporting by London Markets Team)

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