UK 10-year gilt yields recovered after reaching a 19-year high of 5.29% on Wednesday, falling to just below 5.2% as easing energy prices tempered inflation concerns. Brent crude retreated from six-week highs, while natural gas prices fell from their highest level since January 2023 after US President Donald Trump said the renewed US military campaign in Iran would not last long. Markets marginally reduced expectations for Bank of England rate hikes, but now fully price an increase by year-end and another by March 2027. Gilt yields remain elevated amid concerns about energy-driven inflation, higher interest rates and the UK’s fiscal sustainability, despite Prime Minister Andy Burnham’s efforts to reassure markets about the government’s commitment to fiscal discipline.