Rachel Reeves flew to China on Thursday night in a bid to revive closer ties with the nation and boost Britain’s economy amid turmoil in UK bond markets.

Rachel Reeves is facing her first major test since becoming Britain's finance minister after a jump in the government's borrowing costs this week and a deepening of the pound's losses on Thursday, potentially forcing her to cut future spending.

UK markets tumbled yesterday, pushing 30 year gilt yields to the highest level since 1998 1998. In a rare intervention, the Treasury has signalled that if higher borrowing costs wipe out the Chancellor of the Exchequer his fiscal headroom,

Chancellor of the Exchequer Rachel Reeves’s deputy said the gilt market is functioning as normal and underlying demand for UK debt is strong, as pressure grows on the British government amid a rise in borrowing costs and wider market selloff.

Chancellor of the Exchequer Rachel Reeves' deputy said the gilt market is functioning as normal and underlying demand for UK debt is strong, as pressure grows on the UK government amid a rise in borrowing costs and wider market selloff.

The Treasury has said UK financial markets are functioning “in an orderly way” despite the pound plunging to its lowest level for over a year after a rout in the bond markets. Government borrowing costs increased further on Thursday morning,