LONDON: British government bond yields fell to a two-month low on Monday after the prospect of a preliminary peace deal between the United States and Iran sent oil prices down nearly 5%.
Two-year gilt yields dropped more than 6 basis points from Friday’s close to 4.174% at 0715 GMT, according to LSEG data, their lowest since April 20, while 10-year yields fell close to 7 bps to 4.773%, the lowest since April 17.
Euro zone government bond yields were down by around 1-2 bps less.
Interest rate futures priced in 27 basis points of tightening by the Bank of England by the end of the year, with a quarter-point rate increase not fully priced in until December.
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