Summary

• UK gilt yields have risen sharply as investors demand a growing UK-specific risk premium.
• Political uncertainty and questions around long-term fiscal discipline are adding to market concern.
• Higher yields are tightening financial conditions but could improve long-term return potential for bond investors.

Originally published on May 18, 2026

Rising gilt yields

For many investors, the recent volatility in UK gilt markets may feel sudden. UK borrowing costs are now sitting at levels not seen for decades, with 30-year gilt

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