Sterling Knocked Back by Bond Rout

LONDON, Feb 26 Reuters Sterling fell against a stronger dollar on Friday, retreating from a threeyear high touched earlier this week, as a rout in global bond markets sent yields flying and hurt the pound.

The pound has strengthened about 2 this year against the dollar and the euro as traders expect Britains speedy vaccine rollout will help the economy rebound from its biggest contraction in 300 years.

Analysts attributed sterlings fall on Friday to the selloff in bond markets.

Benchmark U.S. Treasury yields vaulted to their highest since the pandemic began, driven by the prospect of accelerating growth and inflation that could trigger a faster rise in interest rates than many expect. Gilt yields also rose sharply on Thursday.

After rising above 1.42 for the first time in three years earlier this week, the pound fell to 1.3901 at 0803 GMT, its lowest since Feb. 18. It was 0.4 lower at 1.3957 at 0937 GMT

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