Gilt yields increased by 13 basis helps to release pressure from UK pension annuities although volatility remains with uncertainty in the Eurozone and the cost of Spain's debt.

Gilt yields have increased by 13 basis points to 2.19% and although there remains a high risk that pension annuity rates will reduce further this does take some pressure off providers and they may hold rates at the current level for a few more days to see how things change.

The 15-year gilt yields have been on a downward direction since the beginning of May reducing 61 basis points from 2.67% to 2.06% on the 5 June. This was due to the threat of a Greek exit from the euro and fear of Spain requiring a bailout.

As a general rule a fall of 61 basis points would result in a 6.1% fall in annuity rates although standard annuities have reduced by 1.78% and smoker annuities by 2.01% in the last month. For updates see Annuity Rates Review.