UK 30-year bond yield hits 6% amid global market turmoil

Global bond markets have experienced a sharp sell-off, with UK long-term borrowing costs reaching a 28-year high as fears about the US deficit and persistent inflation concerns spook investors. The yield on Britain's 30-year bonds hit 6% for the first time since 1998, a development that adds pressure on Chancellor John Healey ahead of the upcoming budget. Investors believe central banks will be forced to maintain or raise interest rates to prevent inflation from becoming embedded, particularly given persistent oil prices and Middle East supply restrictions.

The turmoil extended beyond bonds to equity markets, with the FTSE 100 falling 1.7% in its worst day since May, whilst major European indices also declined sharply. US government borrowing costs reached 24-year highs, with 10-year Treasury yields hitting 5.34% and 30-year yields exceeding 5.67%. Economists and analysts pointed to mounting concerns over government debt levels and a "buyers' strike" amongst investors unwilling to purchase bonds until market stability returns, though yields retreated somewhat by late afternoon as the initial panic eased.