The costs of borrowing in the United Kingdom have risen to the highest level since 1998

Digest opened free editor

Rola Khaleda, FT editor, chooses her favorite stories in this weekly newsletter.

The long -term borrowing costs in the United Kingdom increased to its highest level in 27 years on Wednesday, as Gilts were washed away in a global sale raised by Donald Trump’s trade war.

Revenue on 30 years Gilts 0.28 percentage points increased to a little more than 5.63 percent early on Wednesday afternoon, as a large number of contract exceeded in January to trade at the last time seen in 1998.

The return on a doctrine increased for 10 years, which moves back to prices, 0.16 percentage points to 4.76 percent, while the pound fell against the euro.

The moves came as investors as well Treasury bonds were given to us In reflection of the increasing questions about America’s position as a haven. The prices of government bonds in the United Kingdom often move with the United States market.

Panmure LibeRUM, Simon, said that the movements in the prices of global assets were a sign that the markets felt that the United States “lost control of its senses” in terms of making economic policies.

“Usually, when the United States takes, it takes a sectarian market,” said Thomas Weldic, the European chief economist in Tr Rois. “The long tip of the curve turns into some risky assets because there is a large amount of uncertainty … there is a very little liquidity.”

Puja Kumra, the chief strategy in prices at TD Securities, said that the proceeds of the doctrine are paid up by investors who sell liquid assets in a rush to cash. She said: “Global money ends with the sale of global assets (such as Gilts) for any margin calls or to obtain easy liquidity to meet the crisis.”

UK’s emerging revenues will add pressure on the UK government, which is already facing narrow general challenges and weakening growth expectations.

Craig Incez, head of prices and cash in Royal London Asset Management, said that the increase in the proceeds of sect for a long time was fueled by concerns about the United Kingdom’s growth and the possibility of the government to have to issue more debts in response.

“It is a fear that the only option that governments have is to operate financial taps,” said Anchez. The UK Chancellor Rachel Reeves has pledged this week that she would adhere to her financial rules.

The rise in revenues comes even with investors to harden their bets on interest rate discounts in the Bank of England, where some economists defend a decrease in half a point in the official rate of England Bank in the announcement of monetary policy in the central bank.

Others asked whether the Bank of England could stop the bond sale program if the situation continues to deteriorate.

“When it comes to the sales of bond at the Bank of England, they have put a high tape to change the pace, but if they conclude that the sect market has become a dysfunction – as was the case in 2022 – there is at least a precedence to intervene,” said George Bakli, the economist in Nomura.

Buckley added that if the economic background continues to worsen, the Bank of England may need to meet soon than its scheduled gathering.

The sale came at a time when China announced an additional retaliatory tariff for American imports, reaching a total of 104 percent and matching the level applied to Beijing by Trump since its inception.