Markets appear to be fretting over sustainability of tax and spending plans and whether UK is heading for ‘stagflation’

Rachel Reeves intended to spend January burnishing her reputation on the global stage with trips to Beijing and Davos, and flipping the focus from her £40bn tax-raising budget to Labour’s plans to rekindle economic growth.

Instead, the chancellor was reduced to watching anxiously, as a sell-off swept through government bond markets, and sterling came under intense pressure as a result.