UK 10-year gilt yield nears 4.5% after Trump’s win, inflation worries

The UK's 10-year gilt yield remained near 4.5% on Wednesday, its highest level since October 2023, following Donald Trump's election as the 47th president of the United States.

UK 10-year gilt yield nears 4.5% after Trump’s win, inflation worries

Investors anticipate that Republican policies, including potential tax cuts and increased tariffs, could spur economic growth, widen the fiscal deficit, and raise inflation concerns. Meanwhile, the Bank of England will announce a 0.25% interest rate cut on Thursday. However, investors now foresee fewer rate cuts next year than previously expected after last week's budget.

UK inflation forecast revised to 2.6% for 2025, aligning with BoE predictions

The Office for Budget Responsibility recently revised its 2025 inflation forecast to 2.6%, up from 1.5% in March, closely aligning with the Bank of England's predictions of 2.4% in one year, 1.7% in two years, and 1.5% in three years.