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08.04.202607:20:01UTC+00UK Gilt Yields Drop as US-Iran Ceasefire Eases Oil Prices

The yield on the UK’s 10-year gilt fell by roughly 20 basis points to 4.65% after oil prices slumped, following a two-week ceasefire deal between the US and Iran that was reached just hours before President Donald Trump’s deadline. Under the agreement, the US and Israel pledged to pause their military campaign in return for Iran reopening the Strait of Hormuz, providing a temporary and fragile easing of regional tensions while leaving deeper conflicts unresolved. In turn, traders sharply pared back expectations for Bank of England (BoE) rate hikes, now pricing in just one increase for the year—almost a 30-basis-point pullback from yesterday’s close. This adjustment echoes the retreat in European Central Bank (ECB) rate expectations, although markets still foresee a total of 33 basis points of hikes for 2026.

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