UK 2-year gilt yield surge as Iran-U.S. trade fresh strikes

LONDON, June 1 (Reuters) - ​Short-dated ⁠British government bond ​yields rose sharply on Monday ​after ‌reports that Iranian negotiators were ⁠stopping exchanging messages with ⁠the United States ​through mediators after Israeli attacks on Lebanon.

Two-year gilt yields, which ​are ‌sensitive to the outlook for interest rates and inflation, jumped by as ​much as 12 basis points ‌to 4.329%, their highest since May 22 ‌and on course for the biggest daily rise since May ​15.

Other British bond yields rose ‌between 7-8 bps - similar to the move in euro zone ⁠debt - ⁠as the U.S. ‌and Iran continued to trade strikes despite ​recent ​diplomatic efforts ‌to end three months of war.