Vanguard Group Inc. and Royal London Asset Management Ltd. bought gilts on Wednesday as UK Chancellor of the Exchequer Rachel Reeves’ budget largely won favor with markets, sparking the biggest rally in longer-dated bonds since April.

Treasuries slipped ahead of US data expected to show a rebound in inflation pressures, which would dent speculation over Federal Reserve interest-rate cuts.

Traders are paying a steep price for options protecting against dramatic swings in the pound as speculation ramps up over potential tax hikes in the UK budget.