The yield on the UK’s 10-year gilt rose to 4.77% by the end of a turbulent week, little changed from the previous week and hovering close to its highest level in years. The increase came as escalating US-Iran tensions further strained a fragile ceasefire, keeping markets on edge. Borrowing costs tracked rising oil prices, reigniting inflation concerns and reinforcing expectations of a more hawkish stance from the Bank of England. Markets have adjusted accordingly, with traders now pricing in at least one BoE rate hike by the end of 2026. Meanwhile, Iran maintained its near-total blockade of the Strait of Hormuz, causing the worst disruption to global energy supplies on record while insisting on Lebanon’s inclusion in peace talks. US President Donald Trump criticized Iran’s management of oil flows through the critical waterway. Pakistan is scheduled to host negotiations between the two sides this Saturday.
