UK 30-year gilt yield rises 5 basis points to 5.74%

UK 30-year gilt yield rises 5 basis points to 5.74%

The UK 30-year gilt yield climbed 5 basis points to 5.74% on Monday, September 2, 2025, according to market data. This increase marks a significant milestone, as the yield reached its highest level this century. The rise in yields comes amid broader global trends where long-term government debt is under pressure, driven by concerns about inflation and fiscal policies [1].

The UK gilt yield's surge is part of a broader trend affecting global markets. The yield on 30-year US Treasury bonds also climbed, while yields on Japanese and Australian government bonds reached multi-decade highs. These developments reflect investor concerns about the path of the economy and the effectiveness of monetary policy [1].

The UK's 30-year gilt yield hitting 5.74% follows a period of rising yields across European and UK markets. The UK's 30-year gilt yield had previously been at its highest level since 1998. The increase in yields is attributed to several factors, including high inflation and increased public debt from the pandemic. Additionally, concerns about the UK government's ability to meet its fiscal rules have contributed to the rising yields [2].

Investors are also concerned about the UK's fiscal position. Chancellor Rachel Reeves has faced challenges in balancing the budget and reducing debt, leading to high-profile U-turns on welfare spending cuts and winter fuel payments. The increased interest payments on rising bonds have put the country in a cycle of rising debt [2].

The rise in UK gilt yields is expected to continue as investors await key economic data releases, including the August employment report on Friday. The report could influence the Federal Reserve's decision to resume its easing cycle in September, potentially affecting global bond yields [1].

In summary, the UK 30-year gilt yield's rise to 5.74% reflects broader global trends and investor concerns about inflation and fiscal policies. As the UK government navigates its fiscal challenges, the yield on long-term government bonds is likely to remain a focal point for investors and policymakers.

References:
[1] https://finance.yahoo.com/news/treasury-yields-rise-30-near-134911420.html
[2] https://news.sky.com/story/pound-drops-as-30-year-gilt-yields-at-highest-level-13423597