March 7, 2013 / 12:11 PM / 5 years ago

RPT-Sterling jumps, gilts fall as BoE holds fire on QE

LONDON, March 7 (Reuters) - Sterling jumped to session highs against the dollar and euro and gilts plunged on Thursday after the Bank of England decided not to restart its asset purchase programme, wrongfooting investors who had positioned for more monetary stimulus.

Sterling hit a session high of $1.5074 against the dollar, from $1.4991 before the BoE’s announcement. It recovered from a 2-1/2 year low of $1.4965 touched during Asian trade.

The euro hit a session low of 86.33 pence, down from 86.90 beforehand.

The June gilt future was last 51 ticks down on the day at 116.25, compared to the level of 116.88 shortly before the BoE announcement.

The FTSE 100 pared gains after the Bank of England’s decision, to last trade up 0.4 percent having been up 0.5 percent beforehand.

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