Summary
The UK's long-term borrowing costs have reached a 27-year high, marked by the 30-year gilt yield. This rise is part of a broader trend affecting several European countries and is linked to market demands for long-term government debt and structural changes in pension markets.
Key Facts
- The UK's 30-year gilt yield has reached its highest level in 27 years.
- This yield represents the interest rate for 30-year loans taken by the UK government.
- Similar trends are seen across other European countries.
- The rise may be due to structural changes in pension markets reducing demand for long-term debt.
- There are concerns about the UK's economic and political stability, impacting tax and spending plans.
- The Bank of England and UK Treasury are both auctioning large amounts of government debt, adding complexity to the market.
- The 10-year gilt yield has also risen but remains below previous highs this year.
