GILTS: Parallel Shift Lower In UK Yields

Yields ~3bp lower across the UK curve, with the recent recovery rally in the space underpinned by the pullback from highs in the energy markets. * 10s threaten a break below 5.20% after piercing the level yesterday. Next downside target of note in that benchmark is located at the month-to-date low (5.118%). * 2s10s has failed to challenge the March low (34.84bp) during the recent flattening. * Meanwhile, 5s30s has registered a fresh cycle low in recent sessions (82.40bp) before a recovery back above 90bp. Fresh flattening would expose the March '25 low (78.54bp). * Expect heightened sensitivity to local fiscal matters in the build up to the late October Budget, but energy price swings are likely to continue to dominate in the very immediate term.