UK Gilt Yield at Two-Month High

2026-01-29 09:53 By Joana Ferreira 1 min. read

The UK 10-year gilt yield stabilized just above 4.5%, close to its highest level since November 20, as markets anticipate that both the Bank of England and the Federal Reserve will likely keep rates on hold for the foreseeable future.

In the UK, fresh BRC data showed accelerating price pressures, reinforcing concerns over sticky inflation and potentially limiting the Bank of England’s room to cut interest rates in the near term.

However, a recent rally in the UK pound, driven by broad dollar weakness, may help ease imported inflation pressures and support inflation expectations, potentially offsetting some of the upward pressure from domestic price growth.

Meanwhile, the Federal Reserve left interest rates unchanged, in line with expectations.

Chair Jerome Powell indicated that the central bank is likely to maintain its current stance for some time, citing signs of stabilizing unemployment and inflation that remains somewhat elevated.



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The UK 10-year gilt yield stabilized just above 4.5%, close to its highest level since November 20, as markets anticipate that both the Bank of England and the Federal Reserve will likely keep rates on hold for the foreseeable future. In the UK, fresh BRC data showed accelerating price pressures, reinforcing concerns over sticky inflation and potentially limiting the Bank of England’s room to cut interest rates in the near term. However, a recent rally in the UK pound, driven by broad dollar weakness, may help ease imported inflation pressures and support inflation expectations, potentially offsetting some of the upward pressure from domestic price growth. Meanwhile, the Federal Reserve left interest rates unchanged, in line with expectations. Chair Jerome Powell indicated that the central bank is likely to maintain its current stance for some time, citing signs of stabilizing unemployment and inflation that remains somewhat elevated.
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