UPDATE 1-UK gilt yields rise after faster-than-expected GDP growth
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Writes through with new prices
LONDON, April 11 (Reuters) - British government bond yields rose on Friday after stronger-than-expected growth data somewhat curbed expectations for Bank of England rate cuts, though focus remained on the market implications of U.S. tariff policy.
Britain's economy expanded 0.5% in February , the fastest gross domestic product growth in 11 months and well above the 0.1% expected in a Reuters poll.
Interest rate-sensitive two-year gilt yields GB2YT=RR rose 5 basis points on the day to 3.96% at 0740 GMT versus broadly flat U.S. Treasuries US2YT=RR and German bonds EU2YT=RR.
Ten-year gilt yields GB10YT=RR were also 5 bps higher at 4.697% but this was broadly in line with U.S. and German moves.
Investors on Friday were pricing in 82 bps of further Bank of England rate cuts this year, down from more than 90 bps on Thursday but above the roughly 50 bps expected before U.S. President Donald Trump's tariff announcements last week.
Thirty-year gilt yields GB30YT=RR - which tumbled 16.8 bps on Thursday, their biggest daily drop in over two years - were more than 7 bps higher at 5.502%, resuming the upward climb seen since Trump's tariffs roiled markets.
Thirty-year gilt yields hit their highest since 1998 on Wednesday with their biggest one-day rise since October 2022, which came in the wake of former Prime Minister Liz Truss' poorly received budget plans.
"The acute volatility is akin to that seen at only the most extreme of circumstances," Barclays fixed income strategist Moyeen Islam said about the week's market moves.
(Reporting by David Milliken and Suban Abdulla; Editing by Kate Holton)
((david.milliken@thomsonreuters.com; +44 20 7513 4034;))
