2-year government bond futures (TS) most-active contract up 0.01%, 5-year (TF) up 0.05%, 10-year (T) up 0.06%, 30-year (TL) up 0.09% at midday close.

UKMTO: commercial traffic in the Strait of Hormuz remains constrained.

Houthi forces have mounted some of their deadliest strikes in weeks, raising concern Yemen may slide into full-scale war as the conflict spreads across the Middle East. The Houthis accuse Saudi Arabia of resupplying Yemeni government forces via Mocha port and say Riyadh and Yemeni allies are planning operations against Houthi-held areas. Since January, Yemeni government forces have moved toward unified command and demonstrated stronger air-strike capability. The Houthis’ recent escalation appears aimed at disrupting government preparations, degrading capabilities and forcing a defensive posture, while shaping the rules of any future confrontation. Analysts note a Saudi-led large-scale ground invasion is not inevitable: air campaigns alone have failed to defeat the Houthis over the past decade, Yemen’s mountainous terrain makes ground operations costly, and Saudi Arabia lacks appetite for a protracted war. Consequently, a Saudi-backed offensive by Yemeni government forces is judged more likely than direct large-scale Saudi ground involvement.