Bank of England Governor Andrew Bailey said weak productivity and shocks including COVID-19 had contributed to rising public debt across advanced economies, increasing borrowing costs. He also pointed to ageing populations and demand for higher defense spending as structural pressures on bond markets. His comments came as investors sought a higher interest rate on French government debt than on bonds issued by cosmetics company L'Oreal. Government bond yields have risen sharply in recent months, with British 10-year yields reaching their highest level in almost 20 years and longer-dated yields hitting their highest since 1998. Bailey supported the Monetary Policy Committee's decision to hold interest rates in July while it assessed the long-term inflation implications of the Iran war. Interest rate futures put the chance of a quarter-point increase at the MPC's next meeting this month at about 10%, rising above 60% for the November meeting.