Key insights
- UK 30-year gilt yields surged to a 28-year high as markets priced in more aggressive rate hikes by the Bank of England. Rising Middle East tensions and higher oil prices contributed to the upward pressure on yields. While primarily a UK event, higher global yields can exert some downward pressure on US equities.
Investing.com -- Long-dated UK government bond yields climbed to their highest level in nearly three decades on Tuesday as traders increased bets on additional interest rate increases from the Bank of England.
The 30-year gilt yield jumped 11 basis points to 5.76%, aligning with movements in global bond markets as trading resumed following Monday’s public holiday.
Rising tensions in the Middle East contributed to the market shift, threatening a four-week ceasefire and pushing oil prices higher.
Interest rate swaps now price in nearly three full quarter-point rate hikes from the BOE this year. Last week, markets anticipated two increases with a 50% probability of a third.
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