Newsquawk Logo

[MARKET ANALYSIS] Bonds soar and the curve steepens, as US-Iran agree to a two-week ceasefire

The announcement of a two-week ceasefire between the US and Iran has sparked a significant rally in global bonds and a steepening of the yield curve.

Newsquawk StaffPublished On the live feed at — 9 more headlines followed before this page went public
Newsquawk headlinesUTC

EU PPI YoY (Feb) Y/Y -3.0% vs. Exp. -3% (Prev. -2.1%)

Several explosions reported at Iran’s Siri Island on Wednesday morning; source of explosions unknown, Mehr News reports

[MARKET ANALYSIS] Bonds soar and the curve steepens, as US-Iran agree to a two-week ceasefire

Japan PM Takaichi held 25 minute phone call with Iran President Pezeshkian; requested Iran to ensure safety of all vessels passing through Strait of Hormuz

Qatar says Iran must compensate the nation for damages from Iranian attacks

Open the platform and use it. The whole workspace is free to try, with no signup and no card. When you want the headlines arriving live instead of on a delay, Newsquawk Pro is £24.99 for 7 days.

Try the platform free
Free. No signup, no card.
  • Global fixed benchmarks are soaring this morning, with upside facilitated by the announcement of a two-week ceasefire between the US and Iran, which has helped to pressure the crude complex. As a whole, bonds are stronger, and a clear bull steepening bias is seen across the complex.
  • To recap the geopolitical situation briefly, US President Trump announced he is to suspend the bombing of Iran for two weeks, subject to Iran opening up the Strait of Hormuz, while he stated that this will be a double-sided ceasefire. Interestingly, Trump confirmed they received a 10-point proposal from Iran, and believes it is a workable basis on which to negotiate, while he stated that almost all of the various points of past contention have been agreed to between the US and Iran. Now US and Iran officials are set to meet in Pakistan on Friday, April 10th – the focus will be on whether a deal can be brokered, or if the two-sides agree to a ceasefire extension.
  • USTs are currently trading at session highs, holding at the top end of a 111-05+ to 111-21 range. US paper moved higher on the announcement itself, and then gradually strolled to peaks as the session progressed. European price action has been fairly muted, with the benchmark ultimately trading sideways. From a yield perspective, the 2yr yield now resides around 3.719% (vs Tuesday's close at 3.80%) and well below the peaks from the Iranian conflict at 4.027%. Geopols aside, focus today will turn to the FOMC Minutes of the March confab, where the Bank left rates unchanged at 3.50-3.75%, with no change to forward guidance, balance sheet plans or implementation guidance. A US 10yr auction is also due.
  • Bunds and Gilts follow the above, and currently reside at highs. The former is higher by over 175 ticks and within a 125.74 to 126.45 range, whilst UK paper extends gains of over 230 ticks, in an 89.70 to 90.18 range. Europe and UK fixed income has been considerably pressured since the start of the Iranian war, given their high dependence on external energy. For now, some short term reprieve across assets – and this has been reflected in market pricing, with only 2bps worth of hikes priced in for the ECB’s April meeting (vs 12bps pre-ceasefire); however, the long-term outlook remains uncertain, with markets still pricing in 45bps worth of hikes by year-end. From a yield perspective, the UK 2yr yield sank at the open, bottoming at 4.044% (vs post-Iran war peak at 4.712%); GE 2yr yield now hovers around the 2.50% mark.
Context

This geopolitical easing is alleviating some concerns around energy prices and growth, leading to lower yields and a more favorable environment for fixed income. However, with upcoming FOMC Minutes and uncertain long-term implications from the ceasefire, markets remain cautious about stability going forward.

Related headlines

The whole workspace, free to try.

Try it free
Newsquawk Logo

© 2026 Newsquawk. All rights reserved.