British government borrowing costs jumped on Friday after Andy Burnham, on the left of the governing Labour Party, secured a possible path to challenge Prime Minister Keir Starmer.
The yields on 30-year British gilts - a barometer of how investors view the long-term borrowing needs of the government - leapt by almost 13 basis points in early trade to a session high of 5.779%.
They were close to a nearly three-decade high of 5.813% which was struck on Tuesday.
German 30-year bund yields were up by 3-4 bps.
Borrowing costs for governments around the world were rising on Friday on renewed worries about the inflationary impact of the Iran war.
U.S. Treasury yields hit their highest in around a year on expectations of rate hikes by the Federal Reserve.
But the increase was sharper for British government bonds. They have fared the worst among peers since the start of the Iran war on worries about the country's reliance on natural gas and more recently on worries about a change of prime minister.
Ten-year UK gilt yields were up by about 11 bps, more than double the rise for equivalent German bunds.
Burnham, the mayor of Greater Manchester, was offered a route for a possible leadership challenge on Thursday when a Labour lawmaker in the city said he would resign from his parliamentary seat.
Investors expect a government led by Burnham would increase Britain's already high public borrowing. Last year he said Britain had "to get beyond this thing of being in hock to the bond markets." (Writing by William Schomberg; Editing by Kate Holton and William James)
