UK traders scale back Bank of England rate hike bets
LONDON, May 6 (Reuters) - Investors on Wednesday trimmed
their expectations for interest rate hikes by the Bank of
England in 2026 as optimism about a possible peace deal between
the U.S. and Iran reversed the previous day's surge in gilt
yields and sent oil prices lower.Financial markets were pricing in 52 basis point of
tightening in borrowing costs by the central bank, equivalent to
two quarter-point increases, by the end of this year compared to
63 bps when the market opened.Ten-year gilt yields fell as much as 11 bps to
4.943% at 1019 GMT, their lowest since April 27, after reports
that U.S. and Iranian officials were nearing a one-page
memorandum to end the war.
(Reporting by Suban Abdulla; editing by David Milliken)
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