An issue for John Healey to deal with when he returns from the divisive summit of G20 economic powers in North Carolina is Britain’s high-cost bond yields.If the Chancellor could bring the interest-rate bill of £135billion or so on the UK’s £3 trillion of national debt down, he might be able to fund the defence budget without piling on growth-destroying wealth and bank taxes.The cost of government borrowing is ferocious across the globe, from Japan to France. Even the mighty United States, which relies on the exorbitant privilege of the dollar as a reserve currency, struggles with borrowing costs of 4.79 per cent over ten years and a hefty 5.26 per cent over 30 years.No other G7 rich nation pays as much as Britain to borrow. The ten-year gilt yield stands at more than 5.2 per cent and the 30-year-bond climbed as high as 5.9 per cent yesterday.Bond costs gobble up chunks of tax revenues, push up mortgage costs and set the pace for commercial borrowing.
Why the UK pays more to borrow and it's not just the 'moron premium'
An issue for John Healey to deal with when he returns from the divisive summit of G20 economic powers in North Carolina is Britain's high-cost bond yields.
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