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The Guardian - UK
The Guardian - UK
National
Richard Partington Economics correspondent

Will bond vigilantes punish Rachel Reeves with a Truss-style market meltdown?

London Stock Exchange headquarters
Up to £50bn in extra borrowing for infrastructure investment could reawaken bond vigilantes betting against Britain. Photograph: Hannah McKay/Reuters

UK government borrowing costs have risen ahead of Rachel Reeves’s budget on Wednesday.

Some City investors say the chancellor’s preparations for changing her fiscal rules could be contributing to a febrile mood in financial markets, amid fears that up to £50bn in extra borrowing for infrastructure investment could reawaken bond vigilantes betting against Britain. This includes warnings of a “buyer’s strike” if Reeves handles Labour’s first budget since 2010 badly.

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