UK 10-Year Gilt Yield Falls from 7-Week High

The UK 10-year gilt yield eased to 4.641%, down from a near seven-week high, mirroring declines in US and European bond yields as investors await key economic data. In the UK, flash PMIs are expected to show the smallest contraction in manufacturing in six months and the strongest services expansion in nearly a year. Retail sales are also forecast to rebound, helped by hot weather. Meanwhile, analysts suggest the BoE may slow or halt sales of bonds with maturities over 20 years due to reduced demand from traditional buyers like pension funds. On monetary policy, traders slightly trimmed their outlook but still anticipate two rate cuts in 2025. Globally, EU envoys are preparing contingency plans for a potential no-deal outcome with the US on trade. In Japan, PM Ishiba pledged to stay in office despite a major electoral setback.