UK Gilt Yields Edge Higher on Stronger GDP Data

2026-01-15 08:39 By Joana Ferreira 1 min. read

The UK 10-year gilt yield rose to 4.37%, attempting to recover from a one-year low hit on Wednesday, as investors scaled back expectations of Bank of England rate cuts following stronger-than-expected GDP data.

UK GDP grew 0.3% in November, rebounding from a 0.1% contraction in October and surpassing forecasts of a 0.1% increase.

Over the three months to November, GDP expanded 0.1%, defying expectations of a 0.2% contraction.

Market expectations for monetary easing have shifted slightly.

Traders now price in roughly 46 basis points of cuts by year-end, with an 84% probability of a second 25-basis-point reduction in December.

A first cut remains fully priced in by June, with an 88% chance of occurring in April.

Prior to the GDP release, expectations had priced in just under 48 basis points of easing for the remainder of the year, with 23 basis points by April.



News Stream
UK 10-Year Gilt Yields Fall on US-Iran Peace Hopes
UK 10-year gilt yields fell below 4.85%, their lowest level since April 20, as optimism grows over a potential US-Iran peace deal. Investors are closely monitoring Middle East developments, encouraged by the recent absence of negative signals from both sides and persistent hopes that an agreement to ease tensions and reopen the Strait of Hormuz could still be reached despite recent strikes. Traders have trimmed their bets on Bank of England rate hikes, now expecting about 40 basis points of tightening by year-end, with a roughly 50% chance of a hike next month. Market attention is now focused on upcoming speeches from BoE policymakers for monetary policy signals, as well as political developments surrounding Prime Minister Keir Starmer following Labour’s regional election setbacks.
2026-05-27
UK Gilt Yields Hit April Lows
UK 10-year gilt yields fell to 4.85%, their lowest level since April 20, outperforming European peers as markets reopened after the Bank Holiday weekend and processed fresh Middle East developments. Iran reported explosions in the southern port city of Bandar Abbas, while Washington confirmed it conducted "self-defense" strikes targeting Iranian missile launch sites and vessels attempting to deploy naval mines. This followed US President Donald Trump's statement that a memorandum of understanding between the two nations had been "largely negotiated." Meanwhile, recent data revealed contractions in UK private sector activity during May, alongside cooling inflation and a softer labor market, prompting investors to scale back Bank of England rate hike expectations. Market focus now shifts to upcoming speeches from BoE policymakers for monetary policy signals, as well as political developments surrounding Prime Minister Keir Starmer following Labour’s regional election setbacks this month.
2026-05-26
UK 10Y Bond Yield Hits 4-week Low
UK 10 Year Government Bond Yield decreased to 4.86%, the lowest since April 2026. Over the past 4 weeks, United Kingdom 10Y Bond Yield lost 11.20 basis points, and in the last 12 months, it increased 19.33 basis points.
2026-05-26