Macro-financial risk
2026-04-26
11 minute read
18 sources
UK fiscal trajectory under Reeves: gilt market discipline meets a Labour spending review
Sterling assets are repricing the second year of Reeves's chancellorship. Two budgets, one spending review, and a quarter of acute gilt stress have left the fiscal stance technically compliant with the rules and operationally fragile. The next eighteen months decide whether the framework holds.
Rachel Reeves entered the 2026 budget cycle with public sector net debt at roughly 94.5 percent of GDP, a 30 year gilt yield that touched 5.43 percent in early April, and a tax take heading toward an all time high of 38 percent of GDP by 2030-31. The Autumn Budget 2025 raised an additional 26.1 billion pounds, the June 2025 Spending Revie...