Forex
Oil Prices and Strong US Jobs Data Send UK Gilt Yield Lower
The UK's 10-year gilt yield has dropped to below 5.15%, its lowest level in nearly two decades, following a decline in oil prices.
This move is being closely watched as investors assess stronger-than-expected US employment data and position for potential monetary policy changes.
US nonfarm payrolls rose by 162,000 in August, significantly exceeding market expectations of a 56,000 increase. This has led markets to price in a near 60% probability of a Federal Reserve rate hike this month.
The Bank of England is also expected to raise interest rates by year-end, with another increase anticipated by March 2027, amid persistent concerns over inflation and the UK's fiscal sustainability.