UK Bonds Selloff Follows Iran Strike UK 10y gilt yields jumped ~35bps to 4.35% on Mar 24, 2026; gilt-Treasury spread widened to ~45bps, pressuring auctions and LDI positions (Bloomberg, BoE, ONS).

UK Bonds Selloff Follows Iran Strike: UK 10y gilt yields jumped ~35bps to 4.35% on Mar 24, 2026; gilt-Treasury spread widened to ~45bps, pressuring auctions and LDI positions (Bloomberg, BoE, ONS). 👈 Read full analysis #UKBonds #BondMarket #Investing #GiltYields #FinanceNews

#UK 10Y Gilt Yields Jump Above 4.5%
Stronger wage growth is complicating the BoE outlook, even as global bond yields rise. Markets still price an 84% chance of a rate cut next week, but inflation pressures aren’t easing quietly.

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FTSE 100 Live: UK Bonds and Pound Rise as Starmer Backs Reeves - Bloomberg FTSE 100 Live: UK Bonds and Pound Rise as Starmer Backs Reeves  Bloomberg

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UK bonds suffer biggest selloff since October 2022 as worries build over finance minister LONDON (Reuters) -British government bond prices fell by the most since October 2022 and the pound tumbled on Wednesday, after finance minister Rachel Reeves appeared visibly distressed in parliament, a day after the government sharply scaled back plans to cut benefits. Reeves has repeatedly emphasised her commitment to fiscal rules, limiting the amount Britain will borrow, and, analysts said, the market moves reflected fears that she would be replaced, creating even more uncertainty. The yield on the 10-year government bond, or gilt, rose as much 22 basis points on the day at one point, to 4.681%, as investors ditched UK debt. That would be the largest one-day jump in the British benchmark yield since October 2022, in the aftermath of then Prime Minister Liz Truss’ chaotic fiscal announcement that cost her premiership. The selloff hit the entire gilt curve. Thirty-year yields rose nearly 22 basis points, and 2-year yields rose 11 bps "Gilt yields were moving up but started to spike during (Prime Ministers Questions) as Reeves looked utterly shaken," said Neil Wilson, UK investor strategist at Saxobank. Prime Minister Keir Starmer’s press secretary later said Reeves has his full support, and she was upset because of "a personal matter". Investors are watching Reeves’ position after the British government’s U-turns on welfare reforms mean the plans will no longer save taxpayers any money and have shredded the margin Britain relies on to meet its fiscal rules, analysts said on Wednesday. "The market is pricing in the possibility of a replacement chancellor with a more left-leaning agenda, which is spooking the bond market and waking up the bond vigilantes from their slumber," said Kathleen Brooks, research director at XTB Sterling dropped by more than 1% against the dollar, set for its largest one-day decline since mid-June and also weakened sharply against the euro, after Reeves appeared to wipe tears away in parliament. The pound was last down 1% on the dollar at $1.361. The euro was up 0.6% at 86.4 pence. That would be the euro’s largest one-day rise against the pound in two months. Britain’s domestically focused mid-cap index was down 1.65% on the day, sharply underperforming European stocks. "What’s gone on in parliament today has absolutely unsettled (investors) because what is happening is the market is becoming increasingly concerned with Reeves’ position."

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The recent outage revealed Bloomberg’s systemic importance. 🚨 Dealers couldn’t price bids without its data, delaying a UK government bond auction. This directly affected the nation’s borrowing costs, proving Bloomberg isn’t just a tool—it’s vital market infrastructure! #UKBonds

UK set to issue around 304 billion pounds of bonds in 2025/26, dealers say: Reuters poll By Suban Abdulla and Andy Bruce (Reuters) - Beset by weak growth and rising borrowing costs, Britain will bump up its issuance of government bonds in the coming financial year, and some primary dealers see the risk of a bigger increase, a Reuters poll showed on Tuesday. The Debt Management Office’s announcement for bond issuance in 2025/26 is due shortly after finance minister Rachel Reeves finishes delivering her budget update to parliament on Wednesday, a pivotal moment for gilt investors. The survey of 14 primary dealers - banks mandated by the government to help create a market for its debt - showed the DMO is likely to announce bond issuance for 2025/26 of around 304 billion pounds ($390 billion), up from its current remit of 296.9 billion. Forecasts ranged from 295.5 billion pounds to 321 billion pounds. Such a remit would be the second-largest on record after the 2020/21 year when the COVID-19 pandemic necessitated enormous government support measures for the economy. In October the DMO projected a gross financing requirement, which includes gilts, net T-bill issuance and funds raised from the government’s National Savings and Investment retail arm, of 299.6 billion pounds for 2025/26. With Britain repeatedly coming up against the limits of its fiscal rules - and with it the confidence of investors - the announcement from Reeves and new forecasts from the Office for Budget Responsibility will be watched closely by the gilt market, alongside the DMO’s 2025/26 announcement. Comments from primary dealers underlined the sense of changeable investor confidence surrounding gilts. Adam Dent, chief UK interest rates strategist at Santander (BME:SAN), said the DMO announce an issuance figure below 300 billion pounds on Wednesday for psychological reasons, even if they end up revising planned issuance higher next month. "Keeping gross sales below 300 billion will at least generate less dramatic headlines and support a more confident market reaction on the day of the announcement, even though it would be almost exactly the same as the recent, relentless pace," said Dent, who expects a figure of 299.5 billion pounds. Other primary dealers saw the risk of a larger figure. On Tuesday, Citi revised up its issuance forecast to 321 billion pounds from 307 billion pounds previously on the back of higher-than-expected government borrowing data last week. "The fiscal position has become increasingly detached from the re-pricing of interest rates," said Benjamin Nabarro, chief UK economist at Citigroup (NYSE:C). "An overextended fiscal position has in turn fed back into higher and more volatile funding costs. A rebalancing (in the economy) appears to be in order." The median poll forecast showed the DMO is likely to increase net T-bill issuance by around 5 billion pounds in the next financial year. Across the board, analysts expected the DMO to skew its issuance plans increasingly towards shorter-dated gilts and away from long-dated bonds, which have become increasingly expensive to issue. On Tuesday, the 30-year gilt yield rose to its highest level since mid-January, when they hit more than 25-year highs amid a global sell-off of government bonds, prompted in part by the economic agenda of U.S. President Donald Trump. 2025/26 forecasts, bln stg Gross gilt Net T-bills issuance MEDIAN 303.6 5 Average 305.2 6.5 High 321 15 Low 295.5 0 Count 14 11 Bank of 300 12.5 America Barclays 295.5 3 BNP Paribas (OTC:BNPQY) 301.7 10 Citi 321 0 Deutsche Bank 302 5 HSBC 300 7.2 JPMorgan 305 Lloyds (LON:LLOY) Bank 315 3.5 Morgan 305 5 Stanley NatWest 302.1 5 Markets Nomura 305 5 RBC 308.5 Santander 299.5 15 UBS 312 ($1 = 0.7740 pounds)

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UK borrowing jumps unexpectedly, adding to pressure on Rachel Reeves Increase to £17.8bn is well above City forecasts and is highest December figure for four years

1/ 🧵Yields are a policy choice, not an inevitability. The BoE could implement yield curve control to cap yields and ensure stable ‘borrowing’ costs. #YieldCurveControl #CentralBanking #UKBonds
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