UK Gilts are bonds issued by the British government. The 2022 "mini-budget" crisis demonstrated how quickly they can move due to fiscal credibility and pension-fund (LDI) dynamics. The 30-year "long bond" is driven by long-run inflation, fiscal sustainability, and term premium, and is the least sensitive to near-term policy moves.
Global bond selloff drives UK 30-year gilt yield to 6%, highest since 1998
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Global bond selloff pushes UK 30-year yield to 6% A worldwide bond selloff, sparked by Middle East tensions and oil-driven inflation fears, has driven the UK 30-year gilt yield above 6% for the first time since 1998. This means the government must pay more to borrow, and existing bond prices fall.
This is the main new event of the period and directly explains the sharp rise in the 30-year gilt yield.
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UK sells 30-year bonds at highest yield since 1998 The UK sold £4.25 billion of 30-year bonds at a yield of 5.82%, the highest since records began in 1998. Weak demand from pension funds and high issuance costs mean the government pays more to borrow, pushing yields up.
This shows concrete evidence of rising borrowing costs and weak demand at the latest debt sale.
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Chancellor's cautious budget amid fiscal pressures Chancellor Healey is preparing a cautious budget to keep market confidence, but higher debt costs and spending pressures have shrunk his fiscal buffer by about £9 billion. Investors worry about UK finances, keeping gilt yields elevated.
This highlights UK-specific fiscal concerns that add to upward pressure on gilt yields.
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Market expects central banks to keep rates high Investors now expect the Fed to raise rates at least three more times by mid-2027, and the ECB to hike similarly, as inflation stays stubborn. This keeps global bond yields high, including UK gilts, as UK rates follow the global trend.
This explains the broader interest-rate environment that is pushing UK gilt yields up.
Q3 2026
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Global bond selloff drives UK 30-year gilt yield to 6%, highest since 1998
▼
Global bond selloff pushes UK 30-year yield to 6% A worldwide bond selloff, sparked by Middle East tensions and oil-driven inflation fears, has driven the UK 30-year gilt yield above 6% for the first time since 1998. This means the government must pay more to borrow, and existing bond prices fall.
This is the main new event of the period and directly explains the sharp rise in the 30-year gilt yield.
▼
UK sells 30-year bonds at highest yield since 1998 The UK sold £4.25 billion of 30-year bonds at a yield of 5.82%, the highest since records began in 1998. Weak demand from pension funds and high issuance costs mean the government pays more to borrow, pushing yields up.
This shows concrete evidence of rising borrowing costs and weak demand at the latest debt sale.
▼
Chancellor's cautious budget amid fiscal pressures Chancellor Healey is preparing a cautious budget to keep market confidence, but higher debt costs and spending pressures have shrunk his fiscal buffer by about £9 billion. Investors worry about UK finances, keeping gilt yields elevated.
This highlights UK-specific fiscal concerns that add to upward pressure on gilt yields.
▼
Market expects central banks to keep rates high Investors now expect the Fed to raise rates at least three more times by mid-2027, and the ECB to hike similarly, as inflation stays stubborn. This keeps global bond yields high, including UK gilts, as UK rates follow the global trend.
This explains the broader interest-rate environment that is pushing UK gilt yields up.
Global bonds sell off sharply, pushing 10-year US yield to 5.34%, highest in 24 years
Global bond markets faced heavy selling pressure, driving borrowing costs from the United States, France and Britain to Japan up to multi-decade highs amid concerns over inflation, elevated energy prices and the prospect that interest rates may stay high for a long time. The 10-year US Treasury yield, a key gauge of global borrowing costs, climbed to 5.34% during trading, the highest since 2002, after posting its biggest quarterly rise since the start of the century in the three months through September, before bargain hunting helped the yield ease back to around 5.26% in late US trading. In France, the 10-year bond yield rose close to 5%, the highest since 2002, after the French bond market turned in its worst quarterly performance since 1987, while the yield spread with Germany sat near its widest since the eurozone debt crisis and the cost of insuring against a French default hit its highest since 2013. In Britain, the 30-year bond yield surged past 6%, the highest since 1998, and Japan saw government bond yields rise by double-digit amounts for a fifth consecutive quarter, something never seen before. The Institute of International Finance estimates that over the past year, developed economies paid more than 3.3 trillion dollars in interest on government bonds traded in international markets, more than the roughly 2.6 trillion dollars in estimated global AI spending, 3.1 trillion dollars in defence spending and 2.3 trillion dollars in clean energy. Investors are rapidly shifting their views, with the market expecting the Fed to raise rates at least three more times before mid-2027 and the ECB to raise rates another three times, by 0.25% each, also by mid-2027.
FR-10Y.GB · Monetary · Positive French 10-year yield rose close to 5%, highest since 2002, on inflation concerns and expectations of ECB rate hikes.
GB-30Y.GB · Monetary · Positive UK 30-year bond yield surged past 6%, highest since 1998, as markets expect rates to stay high for long.
JP-10Y.GB · Monetary · Positive Japan government bond yields rose by double-digit amounts for a fifth consecutive quarter amid global inflation and rate-hike expectations.
US-10Y.GB · Monetary · Positive US 10-year Treasury yield climbed to 5.34%, highest since 2002, after biggest quarterly rise this century on inflation and rate expectations.
Pound Slips as Global Bond Rout Lifts Dollar, UK 30-Year Gilt Yields Hit 6%
Sterling traded lower on Thursday, with GBP/USD down 0.38% at $1.3215, as a global bond sell-off pushed U.S. and UK long-dated yields to multi-decade highs and kept the dollar near its strongest levels of the year. The U.S. 10-year yield rose to 5.340%, near a 52-week high, and the dollar index tested the year's high at 101.80, while EUR/USD fell 0.37% to $1.1288. UK 30-year gilt yields rose to 6%, the highest since nearly three decades, and London's FTSE 100 fell nearly 2%, adding pressure on Chancellor John Healey ahead of his first Budget this month. Softer-than-expected August PCE inflation barely dented rate expectations, and ADP data pointed to accelerating payrolls, with investors awaiting jobless claims and ISM manufacturing, where a headline of 55 is expected. ING's Chris Turner said the dollar will likely stay bid in October, and ING expects DXY at 101.50-101.80 today, with an upside breakout possible on strong payrolls or if European debt weakness weighs on the euro.
GB-30Y.GB · Monetary · Positive UK 30-year gilt yields hit 6%, highest in nearly three decades, as global bond rout lifts long-dated yields.
GBPUSD.FOREX · Monetary · Negative Sterling slipped as global bond rout and strong dollar kept GBP under pressure.
US-10Y.GB · Monetary · Positive US 10-year yield rose to 5.340%, near a 52-week high, amid global bond sell-off and firm rate expectations.
ING · Monetary · Neutral ING's Chris Turner is quoted on dollar outlook and DXY range; ING only appears as a commentator, no company-specific development.
US 10-Year Yield Breaches 5.34%, Highest in 24 Years, as Oil Surge Fuels Inflation Fears
The yield on the US 10-year Treasury note surged to its highest level since 2002 amid a global bond selloff, after oil prices climbed on Middle East war tensions, stoking inflation concerns and raising expectations that central banks worldwide may need to hike interest rates further. The US 10-year bond yield rose as much as 6 basis points to 5.34% on Thursday, breaching its previous peak set in 2007. Earlier in the week, the US 30-year bond yield also jumped to a 24-year high. Data from Bloomberg indices showed that global government bonds just suffered their worst quarter since 2024, while Thursday's selloff pushed the UK 30-year government bond yield to 6% for the first time since 1998. Some analysts and investors believe US bond yields could also reach that level. Steven Barrow of Standard Bank Advisory said the rise in government bond yields is a long-term structural development, with financial markets adjusting to a New Normal of higher yield levels. The market is now watching Friday's US nonfarm payrolls report, with a Bloomberg survey of analysts forecasting a gain of 85,000 jobs in September. Investors are also tracking remarks from several Fed officials, including Fed Governor Chris Waller. The market currently expects the Fed to raise rates four more times, by 0.25% each, by the end of 2027.
US-10Y.GB · Monetary · Positive US 10-year Treasury yield rose to 5.34%, its highest since 2002, as oil-driven inflation fears raised expectations of further central-bank rate hikes.
GB-30Y.GB · Monetary · Positive UK 30-year gilt yield hit 6% for the first time since 1998 amid the global bond selloff and rate-hike expectations.
US-30Y.GB · Monetary · Positive US 30-year bond yield jumped to a 24-year high earlier in the week amid the global bond selloff.
UK 30-year bond yield at highest since 1998, around 5.8%
The UK issued 4.25 billion pounds ($5.75 billion) of 30-year government bonds on the 8th, with a yield at its highest level since comparable statistics began in 1998. The bonds, maturing in 2056 with a coupon of 5.375%, were sold via syndication, yielding 5.8168%, the highest for any auction or syndicated sale since the UK Debt Management Office (DMO) was established in 1998. Long-dated conventional gilts once accounted for the majority of UK debt issuance, but due to rising issuance costs and declining demand from pension funds, they are expected to make up less than 10% of the 246 billion pounds of gilt issuance planned for this fiscal year. The UK has the second-highest government borrowing costs among major advanced economies, after Australia, and last week, 30-year gilt yields rose to their highest since early 1998 amid global concerns about inflation stemming from the war between the US and Iran.
Japanese Market Likely to See Triple Decline on Middle East Tensions, with High Oil Prices and Rising Interest Rates as Drags
On May 2, the Japanese market is expected to see both stocks and bonds decline, with the yen also trading in a weak range, making a triple decline highly likely amid heightened Middle East tensions. The US began attacks on Iran's Revolutionary Guard, and Iran retaliated, causing oil prices to surge and long-term interest rates to rise on concerns of a global resurgence in inflation. The US 10-year Treasury yield hit its highest level since October 2023, the UK 30-year gilt yield reached its highest since 1998, and Japan's 10-year government bond yield is expected to rise further from its 30-year high of 3%. In the stock market, following the S&P 500 index hitting a one-month low on May 1, Japanese stocks are also expected to see selling pressure. In the foreign exchange market, the yen weakened to 160.27 against the dollar, with expectations of an early rate hike by the Bank of Japan providing support, while US Treasury Secretary Bessent expressed support for Japanese authorities' market measures.
UK Chancellor Healey Prepares Cautious First Budget
UK Chancellor John Healey is preparing a cautious first budget to maintain market confidence as the Iran war, higher borrowing costs, and government spending commitments squeeze Britain's public finances, Bloomberg reported Saturday. Healey is expected to favor relatively modest measures in his Oct. 28 budget as Prime Minister Andy Burnham's government seeks to avoid unsettling investors or repeating the large tax increases introduced under former Chancellor Rachel Reeves. The chancellor has made fiscal discipline a priority and wants government spending announcements to identify how they will be funded. Britain's fiscal position has weakened since Burnham took office, with Healey inheriting £23.6 billion ($31.9 billion) of headroom against the government's borrowing rule, but higher debt-servicing costs and new spending commitments are estimated to have reduced that buffer by about £9 billion. Long-term government borrowing costs have remained relatively stable since Healey's appointment, with the yield on 30-year UK government debt rising to around 5.79% from 5.75%. Potential revenue-raising measures under discussion include higher taxes on banks following strong recent profits, and Treasury officials have also considered increasing taxes on windfall profits at fossil fuel companies after BP more than doubled its profit between April and June amid elevated oil prices. Healey is separately examining whether Britain's fiscal rules provide room for increased infrastructure borrowing, although officials are wary of triggering a negative reaction in bond markets. The government faces other major spending pressures, including welfare and defense, with plans to raise defense expenditure to 3.5% of gross domestic product expected to be addressed in the government's 2027 spending review rather than the October budget. Healey has yet to commit publicly to spending 3% of GDP on defense by 2030, up from around 2.6% currently, which would require at least another £10 billion. The budget will be Healey's first major fiscal test since becoming chancellor and comes as Labour seeks to preserve its recent recovery in opinion polls.
GB-30Y.GB · Monetary · Negative Budget cautious to maintain market confidence, but higher borrowing costs and spending pressures keep yields elevated.
BP.LSE · Regulation · Positive Potential windfall tax on fossil fuel companies discussed, but BP's profits doubled due to elevated oil prices, making it a target.
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