It's not the first time. In 2022, the presentation of the Truss government's budget - which, let's not forget, featured tax cuts amounting to an unfunded £30 billion - caused a panic on the bond markets. At the time, the 10-year yield jumped to 4.60%, leading to the Prime Minister's resignation. Two years on, and in the absence of such a policy, it's tragically comical to see that the Gilt has just set a new record, but without the same glaring political repercussions.

Source : Bloomberg

What's more, the UK's Treasury Minister even declared that the financial markets were continuing to operate in an orderly fashion. In other words, move along, there's nothing to see. The rise in yields can be partly justified by the movement in all developed economies, led by the United States. However, this should not obscure the difficulties inherent in the British economy: slowing growth combined with rising yields leaves little room for the government to keep to its budget without further spending cuts and/or tax hikes. Technically, however, the Gilt is close to the upper limit of its ascending wedge, which has been in progress since 2022 and is currently holding at around 5%.

In other news, the United States created 256,000 jobs in December, whereas consensus was expecting only 165,000. "Worse still, the unemployment rate fell by 0.1 points to 4.1%. The only positive point was that wages rose by 0.3% on a monthly basis. These statistics did not please investors at all, as they are clearly not going to encourage the Federal Reserve to lower its key interest rates. Bond yields surged following the announcement, with the US 10-year gaining 10 basis points to 4.78%. Conversely, this insolent resilience of the labor market is weighing on equity markets on both sides of the Atlantic. The year 2025 is not starting auspiciously.