The two-year UK government bond yield has fallen, influenced by the cooling of expectations for an interest rate hike by the Bank of England.

Given the weak economic data in the UK, investors have lowered their expectations for a rate hike by the Bank of England, causing UK gilt yields to continue to fall. At the same time, investors believe that the risk of second-round effects is low. Jennifer McKeown from Capital Economics stated in a report, "Given the weak labor market, reduced fiscal support, and high starting interest rates, the ongoing risk of second-round effects seems lower for 2022-23." Data from Tradeweb shows that the two-year UK gilt yield has dropped by 5 basis points to 4.245%, the lowest level in five weeks.