UK borrowing costs hit new highs as City traders brace for Burnham, and pound heads for worst week since 2024 – as it happened

UK 10-year government bond yields have hit their highest since 2008 UK bond yields have now hit new multi-year highs. The yield, or interest rate, on UK 10-year bonds has now risen to 5.15%, their highest level since 2008 and above the high set earlier this week when pressure was mounting on Starmer after last week’s local elections. Thirty-year bond yields also rose, hitting 5.813%, slightly above the 28-year high hit on Tuesday. The pound is heading for its worst week in 18 months on Friday as City traders anticipated that the UK prime minister, Keir Starmer, could face a challenge from the Manchester mayor, Andy Burnham, later this year. After days of uncertainty over Starmer’s future, sterling dropped by around three cents, or 2.2%, during the week to $1.332 on Friday, a five-week low. That would be the largest weekly drop against the US dollar since Donald Trump’s election win in early November 2024. The pound fell against the dollar every day this week as leadership tensions gripped Westminster, culminating in the prospect of Burnham challenging Starmer for the role of PM after the Greater Manchester mayor announced he would run for parliament in the north-west constitu