Chancellor John Healey faces pressure to limit borrowing in his October 28 Budget as global bond markets sell off. Investors warn any extra debt issuance for investment should stay below £10bn to avoid spooking gilt markets.

Matthew Amis of Aberdeen urges tightening day-to-day spending, while Simon French of Panmure Liberum cautions against bravery. UK 30-year gilt yields hit 5.81%, tracking US Treasuries at 5.27%. PM Andy Burnham backs defence spending at 3% of GDP, but Healey allies insist the Budget will be "straightforward" and within fiscal rules.

Rachel Reeves had £24bn headroom in March, but inflation and borrowing costs from the Iran war have eroded it by £5bn-£10bn. Estimates now range £10bn-£15bn. Citi's Callum Mc Laren-Stewart says interest costs alone add £5bn-£6bn. Investors watch for off-balance-sheet vehicles like the National Wealth Fund, but RBC's Neil Mehta stresses credibility hinges on quashing inflation and reining spending.