UK 10-Year Gilt Yield Drops to One-Month Low

2026-02-17 08:25 By Joana Ferreira 1 min. read

UK 10-year gilt yields dropped below 4.4%, reaching their lowest level since January 14, after new figures pointed to continued cooling in the labor market, strengthening the case for interest rate cuts from the Bank of England.

Data released by the Office for National Statistics showed that average weekly earnings, including bonuses, increased by 4.2% in the three months to December, the weakest growth since the three months to August 2024 and below market expectations of 4.6%.

Regular pay, excluding bonuses, rose 4.2%, in line with forecasts.

At the same time, the unemployment rate edged up to 5.2%, its highest level since early 2021 and slightly above the 5.1% economists had anticipated.

Traders have ramped up bets on BoE rate cuts, fully pricing in a 25-basis-point reduction at April’s meeting and assigning a 76% probability that the cut will occur in March.

Two cuts are now fully priced by November, up from around 48 basis points previously.



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