UK pays record yield on 30-year gilt despite bumper demand

The UK debt office sold a 30-year gilt at the highest yield since the body was established, according to results published on Tuesday, highlighting the pressure on public sector finances.

The Debt Management Office re-opened the 5.375% Treasury gilt 2056 through a syndication at a yield of 5.8168%.

Proceeds from the sale are expected to amount to some £4.0 billion, though total orders topped £87 billion, suggesting investor demand was strong.

"Today the UK DMO successfully re-opened its benchmark 30-year gilt, originally launched via syndication on 20 May 2025, reflecting the continued importance of this maturity sector to investors seeking long-dated sterling assets," DMO Chief Executive Officer Jessica Pulay said on Tuesday.

"I am pleased that the transaction was both well-received by the market and efficiently executed, following extensive market feedback, including around optimal sizing. This morning's £4.25 billion offering reflected very strong participation from a broad variety of high quality investors."

Pulay continued: "The success of the transaction, notwithstanding a volatile market environment, provides further demonstration of the ongoing strength and depth of the gilt market and the valuable support from its participants for our financing programme."

BofA Securities, Goldman Sachs International Bank, JP Morgan, Santander and UBS Investment Bank were joint bookrunners.

The yield on the UK 30-year government bond was quoted at around 5.80% around the time of the London equities close on Tuesday. It spiked above the 5.86% mark earlier this month.

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