Stronger than expected UK inflation data, hints from Tony Blair of a dip in unemployment in today’s official figures and further hawkish rhetoric on inflation risks from the ECB left gilts lower across the board.
The December gilt future lost 31p at £109.45 on turnover in 82,000 contracts. Treasury 4¼ per cent 2011 dropped 19p to £97.85, with Treasury 6 per cent 2028 off 57p at £123.65.
Mitchells & Butlers used Citigroup and Royal Bank of Scotland to sell £1.1 million of bonds to securitise its pubs and return cash to shareholders. The issue comprised five tranches maturing between 2028 and 2036. Mellon Capital sold a £200 million 638 per cent bond through Credit Suisse and UBS, while HBOS priced a €500 million 5¼ per cent issue. The size of next week’s auction of Treasury index-linked 1¼ per cent 2017 and Treasury 4¼ per cent 2011 were confirmed as £1.2 billion and £2.5 billion respectively.