On the eve of the UK local elections, the 30-year UK government bond yield rose to its highest level since 1998.

On the eve of Thursday's local elections in the UK, the 30-year UK government bond (gilt) yield rose to its highest level since 1998. Another reason for the rising yields is the market's expectation that the Bank of England will raise interest rates in the coming months to curb inflationary pressures triggered by the Middle East conflict. The market is concerned that if the ruling Labour Party performs poorly in the elections, it could trigger a leadership challenge to Prime Minister Keir Starmer and potentially open the door to loosening fiscal rules. Nigel Green of deVere Group pointed out in a report that long-term gilts are most susceptible to concerns about fiscal sustainability. Data shows the 30-year gilt yield rose to a high of 5.790%.