The obsession with how the 'markets' will react to the budget is ridiculous and unhelpful

101 replies

Aliceisagooddog · 26/11/2025 09:59

Headline after Headline about the bond markets etc. Government is meant to serve the people and the markets are just a small part of our economy. They are meant to serve the economy. This obsession with not upsetting the markets is the tail wagging the dog.

OP posts:

1dayatatime · 27/11/2025 18:39

TheseSpongesAreActuallyVeryGood · 27/11/2025 15:26

Does anyone know the answer to this?

So I get that our bonds fall due for repayment all the time and the goverment just reborrows the same amount effectively to refinance it. However my question is - will the bonds falling due for repayment be carrying a much lower interest rate (reflective of the UK when they were taken out) and thus the new bonds will have a higher interest rate (reflective of the rates today)

So paying back a 10mill pound bond and then reborrowing 10mill will actually cost us alot more in interest.

if that is what happens then surely the interest bill is going to go up and up just by virtue of this. Never mind the new borrowing every month.

Yes you are correct- but much depends on the term of the bonds.

Yields on 30 year bonds for example are at their highest for 25 years. 10 year bonds are not much better. But you can see from these charts how much more expensive it will be to refinance expiring Government bonds

The obsession with how the 'markets' will react to the budget is ridiculous and unhelpful

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