UK issues 30-year bond at 5.82%, highest rate since 1998

The UK Treasury raised £4 billion through a 30-year gilt that sold at a 5.82% yield, marking the steepest rate for that maturity since the Debt Management Office began operations in 1998. Chancellor John Healey, speaking in Coventry, stressed his commitment to fiscal balance as market pressures rise. The auction reflects broader global bond market stress, with yields climbing as investors react to higher oil prices and concerns over public-debt sustainability.

Bank of England governor Andrew Bailey told MPs that the surge in oil prices is adding to inflationary risk and has already pushed mortgage rates up by roughly three-quarters of a percentage point. The Office for Budget Responsibility’s upcoming forecast is expected to show that the higher borrowing cost will cut at least half of the £24 billion fiscal cushion created in the spring. Members of the Bank’s monetary policy committee, including Megan Greene, Dave Ramsden and Alan Taylor, discussed the inflation outlook in a Treasury select committee hearing.