Gilt yields at record 5.79pc as investors sell bonds with fear of high US debt

15-year gilt yields chart - Based on figures for September 2026

Annuity Rates UK - September 2026 review

Investors fear the high level of US debt at $40tn is unsustainable, resulting in the sell-off of bonds and driving yields higher.

UK debt is at £3tn with 15-year gilt yields reaching a record high of 5.79% on 1 October 2026. For UK longer term 30-year bonds the yield reached 6% for the first time in 28 years.

Gilt yields reached 5.72% up 22 basis points on 30 September 2026 and annuity rates continue to rise to an over twenty year high. Our benchmark example based on a 65 year old using £100,000 to purchase a single life annuity and level income is up +6.68% or +£512 pa this year to £8,170 per annum.

Central banks are likely to increase interest rates before the end of the year with the US Federal Reserve raising interest rates by +0.25% in September 2026 to a range of 3.75% to 4.00%.

Fears of higher inflation remain as the Middle East conflict impacts the export of oil and gas in addition to attacks on Saudi Arabia oil facilities by the Houthis keeping Brent oil price at $102 a barrel.

Find related news here:
Annuity rates for age 65 soar over 8pc a two decade with high gilt yields
Gilt yields at record high with investor concern over US $40tn debt

Providers of standard annuities increased rates by an average of +0.96% this month and we would expect rates to rise by +1.24% in the short term if yields remain at current levels.

For smoker and enhanced annuity providers increased their rates by an average of +1.38% and we would expect rates to rise by +0.82% in the short term if yields remain at current levels.

Fig 1 below shows the annuity rates changes for the whole market and the proportion that have either increased, decreased or or did not change. It also shows the range of the changes of the annuity rates over the last month:

Annuity Rates Changes Increase No change Decrease   96%   2%   2% Increases of: max 3.3%   Decreases of: max 0.5 %

Fig 1: Annuity rate changes for the whole market

Fig 2: Change in standard rates last month compared to gilt yields

Fig 3: Change in enhanced rates last month compared to gilt yields