UK 10Y Bond Yield Hits 18-year High

UK 10-year gilt yields climbed above 5.2%, tracking a broader global bond sell-off and reaching their highest level since June 2008, as rising oil prices and increasingly hawkish signals from major central banks have fueled expectations for higher-for-longer interest rates. Brent crude rose as renewed Middle East hostilities heightened concerns over disruptions to regional energy flows. Markets now price around 32 basis points of BoE tightening by year-end, with a November hike seen as almost 70% likely and a second hike by February priced at around 80%. Rate expectations were also reinforced by the latest British Retail Consortium report, which showed UK shop-price inflation accelerating to its highest level in two years. Meanwhile, Fed Chair Kevin Warsh said inflation has not slowed meaningfully and that the Fed still has “work to do,” prompting markets to price a 66% probability of a September rate hike.

UK 10 Year Government Bond Yield increased to 5.21%, the highest since June 2008. Over the past 4 weeks, United Kingdom 10Y Bond Yield gained 25.78 basis points, and in the last 12 months, it increased 40.07 basis points.

United Kingdom 10Y Bond Yield rose above 5.2, according to over-the-counter interbank yield quotes for this government bond maturity.