A surge in borrowing costs has pushed the yield on UK 10-year government bonds, or gilts, to near a two-decade high, increasing the upfront expense of public spending and tightening the financial constraints ahead of the next budget. International financial institutions have raised concerns over growing debt and borrowing risks, while officials have acknowledged the UK’s heightened reliance on bond market conditions. The latest rise in yields follows a broader global sell-off in government debt, adding pressure on fiscal policy just weeks before key economic decisions. Analysts warn the trend could further limit the government’s flexibility in addressing economic challenges.
Rising cost of 10-year gilt to near 19-year high hikes upfront cost of government investment and limits chancellor’s room for manoeuvreBusiness live – latest updatesInternational bodies warn of rising debt and borrowing risksBurnham stands by claim UK is ‘in hock’ to bond marketsA global sell-off in government bonds has put fresh upward pressure on UK borrowing costs, before a tough budget for John Healey next month.The yield – effectively the interest rate – on 10-year UK bonds, known as gilts, had risen to 5.38% by mid-morning on Thursday, approaching the 19-year high set last week. Continue reading...
