Borrowing costs in the UK hit a 2008-financial-crisis high as the country's economy struggles to push back skyrocketing inflation amid continued hikes in interest rates.

Five-year bonds struck a 15-year high, with a yield of 4.89 percent.

The bond rates even surpassed levels reached last year during the shortlived term of former British Prime Minister Liz Truss, which saw a wild combination of economic and political mayhem.

Markets on Thursday ramped up their expectations for further Bank of England rate hikes. 

While prior forecasts projected that the Bank of England will peak rates at 6.5 percent, investors now see that this will not be the upper limit.

Living standards in the UK are being squeezed more severely than at any point since records have been kept in the 1950s, as soaring inflation erodes wage growth for employees across practically all economic sectors.

Read more: Data show UK economy flatlining, severely impacted by mass strikes
 
June marked the 13th consecutive rate hike announced by the BoE, as the government further attempts to tame inflation.
 
Last May, Britain's annual inflation held at 8.7 percent compared to the predicted 8.4 percent, prompting the central bank to issue an unanticipated rate hike.

During the same month, food inflation in the former EU member and the world's sixth-largest economy was running at 18.3% and 14.6% in June, according to official data. 

Recession incoming

Former US Treasury Secretary Larry Summers said earlier this week that Brexit will be memorialized as a "historic economic error" that has damaged the UK's economy after having helped inflation surge.

The UK leaving the European Union led to higher consumer costs, and the country's economic policy has been for several years "substantially flawed", Summers said.

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Brexit "reduced the competitiveness of the UK economy, put downwards pressure on the pound and upwards pressure on prices, limited imports of goods and limited in some ways the supply of labor," which all culminated in higher inflation rates.

Read more: Over 1 million UK children receiving food aid

Summers also went all out on the Bank of England, holding it accountable for the surging inflation rates in the country for its "very ill-judged monetary policies that were substantially too expansionary for too long."

Official numbers show that the UK economy failed to grow in February, owing to the effects of public sector strikes and a drop in industrial production.

The Office for National Statistics (ONS) said in April that the growth rate remained constant in February, falling short of the 0.1% increase predicted in a Reuters poll.

Summers noted that he would be "surprised" if two years go by without the United Kingdom going into recession.

Hunger and poverty

Trussel Trust, a food bank charity, revealed at the end of June that one in seven people in the UK experienced hunger last year as a result of a lack of funds.

The poll revealed that this amounted to an estimated 11.3 million people, which is more than twice the population of Scotland.

Researchers have linked food insecurity to the UK's rising cost of living problem, which has disproportionately affected racial and ethnic minorities, the disabled, and caregivers. This crisis shows no signs of ending anytime soon.

In its network, The Trussell Trust operates more than 1,200 food banks, or almost two-thirds of all food banks in the UK.

According to the organization, it sent a record 3 million food parcels in the year ending in March, a 37% increase and more than twice the number it did five years prior. The most recent findings, it continued, were "just the tip of the iceberg."

Around 7% of the British population was provided with charitable food support during mid-2022, while 71% were facing food shortages with no access to support.

“This consistent upward trajectory exposes that it is weaknesses in the social security system that are driving food bank need, rather than just the pandemic or cost-of-living crisis,” the charity said.