Global bond sell-off piles new pressure on UK borrowing costs before budget

A global government bond sell-off has pushed UK 10-year gilt yields near a 19-year high, increasing borrowing costs ahead of Chancellor John Healey's upcoming budget. Rising yields have eroded much of the fiscal headroom built under the previous chancellor, complicating efforts to meet Labour's fiscal rules without major tax hikes or spending cuts. Bank of England officials warn that sustained high energy prices due to the Middle East conflict may necessitate further interest rate increases, str