Healey plan to slash headroom would ‘not be received well’ by nervous bond market Markets John Healey’s reported plans to slash the breathing space the government has before it breaks its spending rules would spark a negative bond market reaction and lead investors to question the country’s commitment to fiscal credibility. Bond traders told City AM that any attempt to significantly reduce its so-called fiscal headroom would leave the country [...]
Surge in borrowing costs could force Healey to deliver ‘emergency Budget’ Economics Surging government bond yields could force John Healey to deliver an “emergency Budget” in which the UK’s new Chancellor drives through a wave of spending cuts in a bid to bear down on Britain’s ballooning debt pile. UK gilt yields have this week surged to the highest rates seen in decades amid rising uncertainty over [...]
Bailey warns on inflation risks as Iran war roils UK economy Economics Bank of England governor Andrew Bailey has warned inflationary pressures are still buffeting the UK economy and energy prices could rise further next year if the war in Iran continues. Speaking to MPs on Tuesday, the Bank chief said inflation risks were “to the upside” and energy prices “could be higher still” due to the [...]
As it happened: FTSE 100 wavers as weak housebuilding drives faster construction downturn September 4, 2026 Welcome back to City AM‘s FTSE 100 liveblog. The UK’s blue chip index made a soft start on Friday morning, as investors brace for a US jobs report and digest the latest signs of a worsening downturn in the UK’s construction sector. Borrowing costs have eased slightly, after a global rout on government bonds threatened [...]
Reform UK chiefs ask to meet gilt holders amid bond rout September 3, 2026 Robert Jenrick has asked to meet with top traders at the likes of Barclays and Goldman Sachs in London and New York who hold UK gilts as a recent surge in borrowing costs threatens the UK’s public finances. Reform’s Treasury spokesman announced at the Reform conference that he had written to the major holders of [...]
As it happened: Vodafone leads FTSE 100 rally after TV launch; oil jumps again September 3, 2026 Welcome back to the City AM liveblog. Telecoms giants Vodafone and Airtel Africa led a FTSE 100 rally on Thursday afternoon. Investors brushed off early losses caused by the steep sell-off in the the bond market. Two-year gilt yields, which gauges short term interest rate expectations, have jumped over 4.5 per cent, pushing up borrowing [...]
Burnham calls for honesty then sticks his head in the sand September 3, 2026 Andy Burnham declared this week that “change begins with honesty.” My ears pricked up. Was our new Prime Minister about to deliver some hard truths? Of course he wasn’t. The honesty Burnham had in mind was very much “his truth” rather than “the truth.” We were told that all the country’s problems were down to [...]
Mortgage nightmare as investors price in three interest rate hikes September 2, 2026 Investors have priced in three interest rate hikes over the next two years as a global bond market rout sent UK gilt yields soaring. Two-year gilt yields, which gauges short term interest rate expectations, have jumped over 4.5 per cent, pushing up borrowing costs and putting the UK’s economic stability under threat. The Bank of [...]
‘Large tax hikes on the way’: How the global bond rout is boxing in Healey September 2, 2026 Chancellor John Healey is likely to roll-out “large tax hikes” at this year’s Budget due to a rout in global bond markets pushing up the cost of government borrowing, economists have said. A jump in the 10-year gilt yield to the highest level since August 2007 could “further erode” the £22.7bn level of fiscal headroom [...]
IMF sounds alarm on borrowing costs surge as bond rout deepens September 2, 2026 The global rise in borrowing costs is a “particular concern,” the International Monetary Fund has said, as UK bond yields reach a level last seen in the financial crisis. The yield on the 10-year UK gilt climbed four basis points on Wednesday morning to near 5.27 per cent, which followed the previous day’s rally that [...]