Angela Rayner’s economic response to the Labour party’s bruising local elections defeat would trigger a sell-off in UK governments debt at a time when Britain’s borrowing costs are already at multi-decade highs, bond investors and analysts have warned. The former deputy Prime Minister laid out a detailed proposal for how her party to respond to Thursday’s historic defeat at the ballot box, which included “immediate action to cut costs for households” and a windfall tax on energy firms. But several fixed income experts told City AM that the platform proposed by the Labour leadership contender would constitute a “toxic mix” that a gilt market already under pressure from the Iran war would struggle to afford. [...]