Alpha Real Capital says UK breakeven inflation curve falls as real yields rise
TLT•Inflation expectations and rate pricing
RPI dropped to 3% in June from 4.1% in March; 2026 inflation expectations moderated.
Market pricing still points to 1-2 Bank of England rate hikes by year-end, despite the softer inflation trend.
Credit spreads versus swaps tightened about 10 bps from year-to-date highs in March across rating bands.
UK real yields rise while breakeven inflation falls
Alpha Real Capital’s UK Market Monitor Q2 2026 flagged higher real yields, up about 40 bps at the short end and 15 bps at the long end.
Breakeven inflation curve fell as reported inflation cooled; CPI eased to 2.6% in June from 3.3% in March.
