UK government aims to reassure bond market as borrowing costs rise

The UK government is trying to calm concerns in the bond market as borrowing costs rise to their highest levels since the financial crisis. Treasury officials reaffirmed their commitment to fiscal rules amid fears of stagflation and heavy borrowing needs. The yield on 10-year gilts reached 4.93 percent, prompting a drop in the pound to its lowest value in over a year. Treasury officials noted strong demand for UK government bonds, despite recent market strains. Chancellor Rachel Reeves is on a scheduled trip to China, leading to criticism from opposition members. The government plans to review spending this summer, with new forecasts expected in March that could affect fiscal discussions.