UK’s long-term borrowing costs hit highest level since 1998

Rise in bond yields due to fuel prices and political stability concerns will eat away at Rachel Reeves’s fiscal headroom

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The UK government’s long-term borrowing costs have hit their highest level since 1998, amid rising fuel prices and concerns about political stability.

The yield – effectively the interest rate – on 30-year UK government bonds (gilts) hit 5.76% at lunchtime on Tuesday, up 0.11 percentage points – exceeding the 27-year high reached last autumn.