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Sir Keir Starmer expressed his “full confidence” in chancellor Rachel Reeves, but refused to say whether she would still be in her job at the next election.

After falling business confidence, criticism of the October Budget and market turmoil, the prime minister refused to answer questions on Monday about whether Reeves be the chancellor of the whole parliament.

“Rachel Reeves is doing a fantastic job – she has my full confidence,” he said at a press conference in London. “He has the full confidence of the whole party.”

Reeves, who returned Monday from a visit to China, is under pressure to show he has a growth strategy after the UK economy stagnated at the end of 2024 with inflation ticking.

Prime ministers usually refuse to guarantee a job to any cabinet minister for a full parliament, but the Conservatives seized on Starmer’s refusal to answer a question about Reeves’ longevity in Treasury.

They note that in November Starmer’s spokesman appeared to suggest David Lammy would serve a full term – expected to run until 2029 – as foreign secretary. “Yes, he is the foreign secretary,” said the spokesman at the time.

Shadow Treasury minister Gareth Davies said: “The fact that Keir Starmer has repeatedly refused to say whether Rachel Reeves will remain as chancellor.”

Meanwhile, Starmer confirmed that ministers must be “ruthless” in including public spending as the government struggles to stay within its own borrowing rules.

“In terms of the aggressive approach when it comes to finance and spending, yes, we are aggressive,” Starmer said. “We have clear fiscal rules, and we will continue with fiscal rules.”

Recent turmoil in bond markets has pushed up government borrowing costs, threatening to blow a hole in Reeves’ promise to balance daily spending with tax receipts by 2029.

UK borrowing costs have risen sharply since the October Budget as a global bond sell-off combined with fears of higher borrowing and a stagnating UK economy. They added more on Monday, with the 10-year bond yield up 0.04 percentage points to 4.87 percent, moving toward a 16-year high set last week. Yields rise when prices fall.

Sterling, caught up in the gilts sell-off, lost another 0.4 percent on Monday against a rising US dollar, taking the pound to $1.215 in early afternoon trading, and its losses for in the year to more than 2.8 percent – the worst performer among the major global currencies.

Dean Turner, an economist at UBS Wealth Management, said that Reeves is under pressure to act, because waiting for “the hope that the whole period will blow” is not seen by investors as a “credible” one. that answer.

The chancellor is waiting for new data this week that will shed more light on the government’s efforts to stabilize the economy.

Official inflation figures for December will be released on Wednesday, which are expected to show annual growth in the consumer price index of 2.6 percent last month, unchanged from November’s reading.

GDP numbers for November are due the next day, with a Reuters poll pointing to a slight increase of 0.2 percent.

The higher yields since the Budget will not only hinder the outlook for growth, but they are likely to add about £12bn to the annual interest costs of the government, according to calculations from Rob Wood of Pantheon Macroeconomics.

If carried out, they would more than wipe out the chancellor’s entire room of £9.9bn against his current budget ruling, strengthening calls for the chancellor to act quickly in March to cut public spending.

“Reeves should tighten policy in the spring,” he said in a note. “But it is likely that he will share the cuts in the spending plans gradually over five years”.