UK borrowing costs surged yesterday amid a global bonds sell-off prompted by US producer inflation data.
Yields on benchmark ten-year UK bonds – which rise as prices fall – climbed sharply for a second day, peaking at above 4.7 per cent, a two-month high.
There was also a hit for 30-year bonds, which saw yields climb to nearly 5.6 per cent, the highest in nearly three months.
Concern: US inflation – which has so far remained relatively benign despite Donald Trump’s tariffs – could soon rise
US producer prices increased month-on-month in July by a higher-than-expected 0.9 per cent.
The measure tracks wholesale prices, stoking fears that headline consumer inflation – which has so far remained relatively benign despite Donald Trump’s tariffs – could soon rise, too.
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Bond yields rise on US inflation fears