Why Reeves and even Trump have to back down in the face of pressure from bond markets

This government is operating in a very different, much more constrained fiscal environment than its predecessors

- Heather Stewart

It was Bill Clinton's political adviser James Carville, way back in the 1990s, who said that in another life, he would like to "come back as the bond market" - in preference to a president or a pope - because "you can intimidate everybody".

Even Donald Trump, that most wilful of politicians, has been forced to retreat in the face of bond market moves in recent months - ditching the most extreme of his "reciprocal" tariffs, after US Treasury yields jumped.

And despite the traditional status of US Treasuries - government bonds - as a safe haven for global investors, it remains unclear how well financial markets will be able to swallow the $3.3tn (£2.4tn) increase in debt coming down the tracks now that Trump's major tax bill has passed.

So when investors dumped gilts (UK government bonds) on Wednesday, as Rachel Reeves wept in the Commons, it was an abrupt reminder that Labour backbenchers are not the only audience the government must placate.

Like many other major economies hit by a succession of shocks in recent years, the UK's relatively large debt pile means policymakers have to keep one eye on the markets they are relying on to fund their borrowing.