UK government debt costs surged Friday as political uncertainty grips the Labour party.

UK government debt costs surged Friday as political uncertainty grips the Labour party. The 10-year gilt yield jumped 11 basis points to 5.10% following reports that Andy Burnham, Manchester mayor and Keir Starmer rival, is preparing a parliamentary run that could challenge the Prime Minister's leadership. Market analysts attribute the gilt selloff partly to broader bond weakness driven by rising oil prices and persistent inflation concerns. A Labour MP indicated the party's National Executive Committee would likely grant Burnham a waiver to stand, despite traditional rules preventing sitting mayors from contesting House seats. Political observers note Burnham represents a leftward shift from Starmer's current positioning. The timing of this leadership challenge adds another layer of uncertainty to UK financial markets already navigating inflation pressures and global bond volatility.