The yields on British bonds are approaching their highest levels since 1998.

Alsharq Tribune - Sarah Benkraouda 

In anticipation of a new bond issue later this week, UK Treasury Secretary Rachel Reeves is under greater pressure to calm the markets .As  the yield on long-term British Treasury bonds has risen to its highest level in over 25 years.

According to Bloomberg News, the yield on 30-year bonds increased by almost 4 basis points today to 5.19% . Approaching its peak of 5.21% in 2023 and its highest level since the 1990s. When the bonds recovered some of their losses and the yield increase slowed.

It is important to note that investors have been watching the UK closely .Ever since the new Labour Party administration revealed in its October budget , a near-record number of bond issuances and borrowings .which rekindled worries about the nation's expanding debts .

The yield on the benchmark 10-year bonds has increased by roughly 40 basis points since late October . As a result of a surge of government bond sales triggered by Treasury Secretary Reeves' expenditure plans.

"The recent UK budget continues to put pressure on bonds . And this situation will persist as many of the bond sales planned in the budget , will take place during the first quarter of this year." Said Puja Kumra, Senior Analyst for British and European interest rates at Toronto Dominion Bank.

This week, investors are getting ready to buy up to £6.5 billion worth of 5- and 30-year bonds. Through auctions, run by the UK Debt Management Office.

In order to decrease the size of its holdings , of Treasury bonds with maturities ranging from seven to twenty years. The Bank of England is conducting an operation that includes these auctions.