On Friday, UK government borrowing costs experienced a significant spike as Andy Burnham, the mayor of Greater Manchester, positioned himself as a potential challenger to Prime Minister Keir Starmer. The yield on 30-year British gilts surged by nearly 13 basis points, reaching 5.779%, which is close to the nearly three-decade high of 5.813% recorded earlier in the week. This rise in yields reflects investor concerns regarding the inflationary pressures stemming from the ongoing Iran war and the UK's reliance on natural gas. In comparison, German 30-year bund yields rose by only 3-4 basis points, highlighting the sharper increase in British borrowing costs. Additionally, ten-year UK gilt yields rose by about 11 basis points, more than double the increase seen in equivalent German bonds. Burnham's potential leadership bid gained momentum after a Labour lawmaker announced their resignation from Parliament, prompting speculation about a leadership challenge. Investors are wary that a government led by Burnham could exacerbate the already high levels of public borrowing, a sentiment echoed in his previous remarks about the need for the UK to move beyond its dependence on bond markets.