UPDATE 3-Pound's "flash crash" strains bond, stock market nerves
* Algo-driven flash crash leaves sterling 2.5 percent lower
* Political pressure on currency continues to build
* FTSE 100 benefits, mid-caps suffer
* Gilt yields surge as inflation expectations rise
* Worries over twin deficits in background
* For graphic, click tmsnrt.rs/2dAcyM6 (Adds quote, FTSE close)
By Patrick Graham and Kit Rees
LONDON, Oct 7 (Reuters) - Sterling lost as much as 10 percent of its value in just a few minutes of trading early on Friday, a "flash crash" that fuelled concerns about the vulnerability of the currency and other British assets to investor worries about Brexit.
The pound recovered from the initial plunge, which took it as low as $1.1491 in Asian hours and was driven, dealers said, by the automated algorithmic computer trades that now dominate the global foreign exchange market. Continuación...