Roller-coaster week sends UK yields higher
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UK borrowing costs have seen their first weekly rise since May after a 'rollercoaster' ride sparked by growing fears about Labour's handling of the public finances.
Ten-year borrowing costs shot close to 4.7 per cent on Wednesday after a tearful House of Commons appearance by Chancellor Rachel Reeves sparked doubts about her future.
And though the moves in UK bonds – known as gilts – were mainly reversed in the following days as the Prime Minister backed Reeves, the episode added to worries sparked by the Government's humiliating climbdown on welfare reforms on Tuesday.
Yields last night ended the week at 4.56 per cent, up from 4.5 per cent the previous Friday.
It was the first weekly increase after a steady run of declines since mid-May.
That partly reflected global moves as US bond yields turned higher thanks to worries about America's ballooning debt and trade tariffs. Nevertheless, it will pile further pressure on the beleaguered Chancellor as the increased borrowing costs will make it even harder to balance the books.

Oliver Faizallah, head of fixed income research at wealth advisers Charles Stanley, said: 'This week's blowout was a reminder that the gilt market will not take kindly to excess borrowing.'
Yields on UK ten-year bonds, known as gilts, began the week at around 4.5 per cent and eased close to 4.4 per cent ahead of the welfare vote in Parliament on Tuesday night – when it seemed Labour would manage largely to push through its plans. But last-minute concessions that helped the Government win the vote wiped out the intended savings.
That blew a £5billion hole in the Chancellor's plans and sending yields racing towards 4.5 per cent the next day, before they climbed even further after Reeves' Commons appearance.

It added to the damage to public finances caused by a previous U-turn on winter fuel payments, a deteriorating growth outlook and an increased commitment to defence spending.
Andrew Goodwin, of Oxford Economics, said the volatility in gilts 'emphasises the need for fiscal discipline'.
The sharp rise in yields reflected anxiety in the markets that, despite the Labour Chancellor's dismal economic record so far, her successor might prove even more of a worry by loosening the Government's commitment to balancing the books.
Instead, ministers will need to try to find the missing billions elsewhere. Goodwin said: 'The experience will have demonstrated to the Government that markets will likely look unfavourably on any further loosening of the fiscal rules, increasing the chances that we see large tax rises in the Budget this autumn.'
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