Rachel Reeves's number is up as Donald Trump triggers UK debt crisis

Long-term UK borrowing costs have just hit their highest level in 27 years, in the latest blow for our beleaguered Chancellor. As I write, 30-year gilt yields have climbed above 5.5%. That's almost 20% higher than when Labour took power just over a year ago, when they were around 4.6%.

Incredibly, it's also the highest number since 1998. For a country with a massive £3trillion debt pile, that's punishing.

And there's little Rachel Reeves can do to stop it, because this time the trigger lies in Washington. I warned a US financial storm was heading our way a few days ago, and it's already landing.

Last night we had confirmation that Donald Trump's tariffs are driving up US inflation, and the UK government bond market is reeling from the shock.

US producer prices rose 3.3% in July, far above the 2.5% forecast, with tariff-hit metals and food leading the surge.

American businesses are starting to pass the costs on to domestic consumers, driving up prices. Where US inflation goes, ours tends to follow. As does the interest we pay on our debts.

More than a quarter of UK government bonds, known as gilts, are inflation-linked, the highest proportion in the world.

This means rising inflation feeds directly into higher interest bills on our massive debt pile.

The UK borrowed £20.7billion in June alone. Of that, an incredible £16.4billion went on servicing the interest on money we previously borrowed.

That has nearly doubled in a year due to rising gilt yields. After this week's jump, we'll pay even more.

And that's despite the Bank of England cutting rates five times since Reeves took office. Gilt yields should be sliding, not rising.

Reeves was already facing a £50billion hole in the public finances. Trump's inflation shock will make filling it even harder.

Britain's borrowing costs were already inflated because global investors don't trust our public finances.

Germany pays just 3.2% on its 30-year bonds, a gap that drains tens of billions from our budget each year. Reeves needs to close that gap, but instead it's getting wider.

The comparison with Liz Truss is unavoidable.

Her brief time in Downing Street sent 10-year gilt yields surging to 4.372% and helped topple her government. Today, they're higher at 4.647%.

The extra cost is crippling. The Chancellor's own mistakes have left her at the mercy of events beyond her control, such as Donald Trump.

The US President isn't gunning for the UK but risks pulling the trigger on a debt crisis anyway.

Reeves was already struggling to make her columns tally. If gilt yields climb much higher, her number could be up.