UK government borrowing costs have risen ahead of Rachel Reeves's budget. Some investors warn that extra borrowing for infrastructure may lead to a buyer's strike if not handled well.
Benchmark 10-year UK government bond yields have risen about 0.2 percentage points in the past month. Analysts attribute this increase to the prospect of heightened government borrowing.
Despite rising borrowing costs, some analysts argue that fears surrounding the budget are overblown, citing that recent changes are relatively small compared to past budgetary events.
The Treasury's Debt Management Office is expected to increase its net financing requirement to about 300 billion for the current financial year, the highest since the pandemic.
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