Global bond rout deepens as oil prices jump; wheat prices highest since early 2023 – as it happened

From 1 Sept 2026Long-term UK borrowing costs at 28-year highLonger-dated gilt yields have also surged, which means higher borrowing costs for Andy Burnham’s government.The yield, or interest rate, on the 30-year gilt jumped 9 basis points to 5.88%, the highest since March 1998.This comes as oil prices keep climbing, with Brent crude rising 1.7% to $92.1 a barrel. US West Texas Intermediate is 1.9% higher at $87.35 a barrel.Thomas Pugh, chief economist at the audit, tax and consulting firm RSM UK, said:

double quotation markGilt yields are up and it’s tempting to blame this on UK-specific factors. But government bond yields are surging across the world, especially in America. That doesn’t mean the UK is off the hook. We still have to pay a higher interest rate than similar countries, suggesting investors see us as a riskier place for their cash. That reflects a combination of political risk, low growth and sticky inflation.

The energy shock and the threat of rising inflation are important factors. Inflation expectations matter because inflation erodes the purchasing power of a bond’s fixed payments. When investors believe inflation could remain elevated, they demand a higher yield as compensation.