The yield on the UK’s 10-year gilt rose to 4.8%, approaching multi-year highs, as renewed inflation concerns followed the collapse of US–Iran peace talks. Washington attributed the breakdown to Tehran’s refusal to abandon its nuclear ambitions, while Iranian media denounced what they called “excessive” US demands.
Heightening tensions further, US President Donald Trump threatened to blockade the Strait of Hormuz, a key global oil transit chokepoint, driving Brent crude up to $102 per barrel. The resulting surge in energy prices has intensified the global energy crisis, stoking fears of an inflation shock and leading traders to price in nearly two Bank of England rate hikes by the end of 2026, compared with just one expected as recently as last week.
