UK Gilt Yield Nears 2008 High on Leadership Uncertainty

2026-05-14 06:50 By Joana Ferreira 1 min. read

The UK 10-year gilt yield climbed toward 5.1%, nearing its highest level since 2008, as speculation intensifies over a potential leadership challenge to Prime Minister Keir Starmer.

Reports suggest Health Secretary Wes Streeting, the most market-friendly candidate, may resign this week and launch a bid to replace Starmer as soon as today.

Meanwhile, Angela Rayner, another potential contender, was cleared by HMRC in a tax probe this morning, potentially paving the way for her to join the race.

While Streeting is seen as favorable for markets, Rayner’s left-leaning stance is viewed as less positive for gilts.

Adding to the pressure, stalled US-Iran negotiations and the closure of the Strait of Hormuz have kept oil prices elevated, with markets now pricing in nearly three Bank of England rate hikes by year-end.

Economically, the UK’s GDP grew by 0.6% in Q1 2026, with annual growth at 1.1%, exceeding expectations.

March’s unexpected 0.3% expansion drove the upside.



News Stream
UK Gilt Yield Nears 2008 High on Leadership Uncertainty
The UK 10-year gilt yield climbed toward 5.1%, nearing its highest level since 2008, as speculation intensifies over a potential leadership challenge to Prime Minister Keir Starmer. Reports suggest Health Secretary Wes Streeting, the most market-friendly candidate, may resign this week and launch a bid to replace Starmer as soon as today. Meanwhile, Angela Rayner, another potential contender, was cleared by HMRC in a tax probe this morning, potentially paving the way for her to join the race. While Streeting is seen as favorable for markets, Rayner’s left-leaning stance is viewed as less positive for gilts. Adding to the pressure, stalled US-Iran negotiations and the closure of the Strait of Hormuz have kept oil prices elevated, with markets now pricing in nearly three Bank of England rate hikes by year-end. Economically, the UK’s GDP grew by 0.6% in Q1 2026, with annual growth at 1.1%, exceeding expectations. March’s unexpected 0.3% expansion drove the upside.
2026-05-14
UK Gilt Yield Back to 18-Year High on Leadership Contest Fears
The UK 10-year gilt yield climbed back above 5.1%, nearing the 18-year high of 5.13% hit in the previous session, after The Times reported that Health Secretary Wes Streeting is preparing to trigger a leadership contest to oust Prime Minister Keir Starmer. The news erased earlier gains in bonds, leaving yields little changed, though this follows a 19-basis-point surge over the past two days. Starmer, whose cabinet has remained largely intact despite a few junior minister resignations, has reaffirmed his intention to stay in office despite pressure from several ministers and over 80 Labour lawmakers calling for his resignation following the party’s poor local election results. Meanwhile, stalled US-Iran negotiations and the closure of the Strait of Hormuz have kept oil prices elevated, with markets now pricing in nearly three Bank of England rate hikes by year-end.
2026-05-13
UK Gilts Recover Ground After Steep Selloff
UK gilts regained some ground on Wednesday after recent selloffs, with the 10-year gilt yield falling to 5.08% from an 18-year high of 5.13% in the previous session. The 30-year gilt yield also declined slightly to 5.75%, retreating from its 28-year peak. Investors found relief in a modest drop in oil prices and the absence of a strong challenger to Prime Minister Keir Starmer, whose cabinet remained largely intact despite the resignation of a few junior ministers the day before. Starmer has reaffirmed his intention to stay in office, despite pressure from over 70 Labour MPs calling for his resignation following the party’s disappointing local election performance. Concerns persist that a leadership change could lead to increased fiscal spending to regain voter support. On the monetary policy front, markets are pricing in nearly three Bank of England rate hikes by year-end.
2026-05-13