Bond investors express concerns over UK Labour's financial strategy under Rachel Reeves

Bond investors are reacting negatively to the UK Labour government's financial management under Chancellor Rachel Reeves. Yields on 10-year government bonds, known as gilts, have risen from around 3.75% to nearly 4.9% since the July election. This increase in yields indicates a loss of confidence in Labour's economic strategy. Investors are demanding higher returns due to perceived risks, which could add an estimated £10 billion to the UK's borrowing costs. Reeves plans to issue £300 billion in gilts this year, but rising interest rates may force cuts in spending or tax increases. The bond market's response suggests a significant shift in investor sentiment towards Labour's fiscal policies.