Gilts, pound steady after BoE slows QT, keeps rates steady

MUMBAI, Sept 18 (Reuters) - British government bonds and the pound offered a muted reaction to the Bank of England's widely expected decision on Thursday to leave interest rates unchanged and slowing the pace of its sovereign debt holdings.

The yield on the benchmark 10-year gilt GB10YT=RR was steady at 4.622%, little changed on where it had been trading prior to the central bank's decision, while the 30-year gilt yield GB30YT=RR was down 1 basis point at 5.423%.

Policymakers voted 7-2 to slow the annual pace at which the central bank unloads the gilts which it purchased from 2009 and 2021 to 70 billion pounds ($95.38 billion) from 100 billion pounds, broadly in line with a Reuters poll median forecast for a decline to 67.5 billion.

Sterling GBP=D3 initially rose after the BoE's decision but pared those gains to last trade flat on the day at $1.3692. It was little changed against the euro EURGBP=D3 as well, which traded at 86.72 pence.

Britain's benchmark FTSE 100 .FTSE stock index was last up 0.1%, while the rate-senstive mid-cap stock gauge .FTMC was up nearly 0.3%.

($1 = 0.7339 pounds)