UK borrowing costs fall for second day on Middle East de-escalation hopes

LONDON, March 24 (Reuters) - British short-term government borrowing costs fell in early trade on Tuesday after a sharper drop on Monday when U.S. President Donald Trump ordered a five-day pause on air strikes against Iranian energy infrastructure.

Two-year gilt yields GB2YT=RR were down by around 9 basis points at 4.32% at 0810 GMT, having fallen by about 17 bps in the previous session.

Interest rate futures were pricing in two quarter-point rate rises by the Bank of England this year and the possibility of a third, down from four before Trump's comments on Monday.