Investors cut bets on BoE rate hike after coronavirus variant news

Investors scaled back their bets on the chance of a Bank of England interest rate hike in December in early trade on Friday after a coronavirus variant that might be harder to combat with vaccines was detected in South Africa.

Interest rate futures were pricing a roughly 55% chance of 15 basis-point rate hike by the BoE on Dec. 16 – after its next scheduled monetary policy meeting – compared with a roughly 75% chance on Thursday.

Yields on two-, five- and 10-year British government bonds fell by around 10 basis points in early trade.