Britain on Tuesday received another sign that inflation could painfully linger. The country braced, once again, for higher interest rates as bond yields climbed above the levels when Liz Truss was prime minister last year.

Data showed that wage growth, a closely watched indicator for how deeply inflation is embedding in an economy, was rising in Britain at the fastest pace in at least two decades.

Regular pay, which excludes bonuses, in February, March and April rose 7.2 percent from a year earlier, Britain’s Office for National Statistics said Tuesday. That’s the most since current records began, excluding during the pandemic, when furlough distorted labor market data.

The agency also reported other signs that the labor market was strong, including rising employment, more people looking for jobs and a decline in the unemployment rate. While these indicators are normally desirable for people’s living standards, they now suggest growing inflationary pressures.

Traders responded to the data by betting that the Bank of England would raise interest rates even higher.

The labor market data was “almost unequivocally hawkish,” according to economists at HSBC, meaning the numbers favored tighter monetary policy. The HSBC economists said they expected the central bank to raise rates a quarter-point at its meeting next week, with several policymakers voting for a larger increase.

For a year and half, interest rates in Britain have been pushed higher as the country battles its worst inflation in more than four decades. The Bank of England has raised rates to 4.5 percent from nearly zero at the end of 2021. While inflation peaked late last year in Britain, and fell to 8.7 percent in April, it has slowed less than in the United States and in much of Europe.

Traders are betting that the Federal Reserve might pause its interest rate increases this week, but the Bank of England might not be able to follow suit — despite laying the groundwork for a potential pause months ago — because data keep pointing to inflation being stickier than expected.

Now, traders are betting that British policymakers might have to raise rates through the summer and keep them high through the fall, reaching 5.7 percent early next year.

Yields on British government bonds are higher than when Ms. Truss was prime minister in September and October. Her tax-cutting, free markets agenda spooked markets and caused bond yields to surge, roiling the mortgage market and pensions industry. Yields on two-year bonds, which are heavily influenced by changes in the central bank’s rate, rose about 0.2 points to 4.8 percent on Tuesday morning, the highest since 2008.

During Ms. Truss’s premiership, yields this high reflected concerns about Britain’s fiscal responsibility. Now they point to worries that inflation will be stubborn and that the central bank will have to raise rates and keep them there for longer than previously expected.

The expectations of higher rates are, again, causing turmoil in the home loan market as some lenders pull offers for new mortgage deals.

Jonathan Haskel, a member of the Bank of England’s rate-setting committee, wrote in a newspaper column on Monday that “further increases in interest rates cannot be ruled out.”

“As difficult as our current circumstances are, embedded inflation would be worse,” he added.

Late last month, economists at Goldman Sachs said they expected the Bank of England to raise rates to 5.25 percent, which would be the highest since February 2008.

On Tuesday, Ibrahim Quadri, a Goldman analyst, wrote in a note that he remained concerned that wage growth in Britain would settle at a level that would be inconsistent with the central bank’s meeting its target of 2 percent inflation.

While the fast pace of wage growth is likely to unsettle the central bank’s policymakers, it will bring limited comfort to many of Britain’s workers because it continues to lag behind inflation. Most people are experiencing a real-terms pay cut as the price of food and services rise at the fastest pace in decades.

“Rising prices are continuing to eat into people’s paychecks,” Jeremy Hunt, the chancellor of the Exchequer, said in a statement on Tuesday. “So we must stick to our plan to halve inflation this year to boost living standards.”

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