British Prime Minister Keir Starmer speaks at the start of a Cabinet meeting to mark the fourth anniversary of Russia’s full-scale invasion of Ukraine, at Downing Street in London, Feb. 24, 2026.
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Yields on U.K. government bonds surged to multi-decade highs on Tuesday morning, as pressure mounted on Prime Minister Keir Starmer to resign from his post.
By 8:41 a.m. in London, the yield on the benchmark 10-year gilt had jumped 10 basis points to trade at around 5.103%. Bond yields and prices move in opposite directions.
Meanwhile, yields at the long end of the curve reached their highest since 1998, with the 20-year gilt yield adding 10 basis points while 30-year yields jumped 11 basis points higher.
U.K. 20- and 30-year gilts
Starmer’s leadership is on a knife edge after more than 70 Labour lawmakers called for his resignation.
The prime minister held a routine meeting with his cabinet on Tuesday morning.
The calls for Starmer to resign came after the Labour Party suffered major losses in local council elections last week.
Growth and living standards have stagnated in the U.K. in recent years, with the country facing a cost-of-living crisis in the wake of the Covid pandemic and the Russia-Ukraine conflict.
Starmer’s Labour Party has faced growing public anger at the slow pace of economic reforms, with Thursday’s vote seeing huge gains for the right-wing Reform UK and the left-wing Green Party.
But bond vigilantes have largely been supportive of Starmer and Reeves retaining their positions relative to potential alternatives, with U.K. bonds selling off in previous bouts of uncertainty over their political futures.
Last July, yields on gilts surged after Reeves was seen crying in parliament, amid reports that her role in Starmer’s cabinet was in jeopardy. It came after the government U-turned on her proposed welfare cuts following a rebellion from Labour politicians.
Health Minister Wes Streeting, former Deputy Prime Minister Angela Rayner and Greater Manchester Mayor Andy Burnham are reported to be among the top contenders to replace Starmer. Rayner and Burnham — who is currently ineligible to stand as prime minister because he lacks a seat in parliament — are broadly considered more left-leaning than Starmer.
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