2026.03.1912:11:45UTC+00UK Gilt Yield Surges Past 4.8% on BoE’s Hawkish Hold

The UK 10-year gilt yield rose above 4.8%, its highest level since September 2025 and close to a more-than-one-year peak, after the Bank of England unanimously voted to keep interest rates on hold at 3.75%—a more hawkish outcome than markets had expected. Investors had anticipated a 7–2 split in favor of unchanged rates, but policymakers instead emphasized risks stemming from the Middle East conflict and its impact on surging global energy and commodity prices. The BoE now expects near-term CPI inflation to edge higher in response to this new economic shock, marking a reversal from the earlier trend of disinflation in domestic prices and wages. In turn, traders have fully priced in two rate increases for this year, strengthening expectations of tighter monetary policy. Meanwhile, UK labour market data showed wage growth slowing and the unemployment rate steady at 5.2%, with both figures coming in weaker than forecast.