Bond Rout and Rising Borrowing Costs: UK Mortgage Rates Set to Jump as Global Sell-Off Reshapes the Economic Landscape

UK mortgage rates are poised for a significant jump after the five-year swap rate – the benchmark lenders use to price fixed deals – surged above 4.52%, its highest level since October 2023, driven by a global bond sell-off. The turmoil has pushed 10-year gilt yields to near-two-decade highs, though they retreated slightly to 5.195% on Thursday as some market panic eased. The initial sell-off was triggered by fears of higher inflation following a jump in oil prices...