First of all: don’t panic.

What you need to know is this. The budget was not well received in the financial markets. In fact, it’s shrunk as much as any budget in recent years, except Liz Truss’s mini-budget.

The pound is weaker. Government bond yields (essentially the interest rate paid by the Treasury on its debt) have risen. This is precisely the opposite market reaction to that which chancellors like to see after presenting their financial statements to the House.

All this began to crystallize soon after the Budget speech, with yields starting to rise and the pound weakening, just as investors and economists got their hands on the Budget documentation. But the fall in sterling and the rise in bond yields accelerated today.

This is not, to be absolutely clear, the sort of response a chancellor wants to see after a Budget – let alone in his first Budget in office. Indeed, I cannot recall another Budget that has seen such a hostile market reaction as this one in many years – with the exception of one.

That exception is, of course, the Liz Truss/Kwasi Kwarteng mini-budget of 2022. And this is where you’ll find the silver lining for Sir Keir Starmer and Rachel Reeves.

The rises in government bond yields and falls in sterling over the past few hours and days are still much lower than what happened before and after the mini-budget. This does not yet look like a crisis moment for UK markets.

But this is not good news for the government either. In fact, it’s quite horrible. Because higher borrowing rates on UK debt mean that the UK (well, us) will end up paying a lot more to service our debt in the years to come. And that debt is set to rise significantly due to plans outlined by the Chancellor this week.

And this is where things get particularly tricky for Ms. Reeves. In that Budget document, the Office for Budget Responsibility said the Chancellor could afford to see these government bond yields rise by around 1.3 percentage points, but then when they rose above that level , the so-called “room for maneuver” it had in relation to its budgetary rules would evaporate. . In other words, she would be breaking these rules – which, remember, are considerably less strict than those she inherited from Jeremy Hunt.

Which begs the question: where are government bond yields now? How close are they to the danger zone where the Chancellor ends up breaking her rules?

Short answer: it’s worrying. Because right now, the five-year government debt yield (which is the maturity the OBR is most focused on) is more than halfway to that danger zone – just 56 basis points from the point where debt interest costs eat up any room for maneuver the chancellor has. to avoid breaking its rules.

However, we are not yet in crisis territory. And every move in currencies and bonds cannot be attributed to this budget either. Markets are volatile at the moment. There’s a lot going on: a US election next week and a Bank of England interest rate decision next week.

The chancellor might be lucky. Gilt yields could stabilize in the coming days. But at present, the United Kingdom, with its high level of public and private debt and its new government which has just committed to borrowing several billion more in the years to come, is being closely scrutinized by the “vigilantes obligations”.

A Halloween nightmare for any chancellor.