The rise in gilt yields following the Kwarteng/Truss Budget in September 2022 is commonly held up as a poster child for why an increase in government borrowing is a risky endeavour. This column argues that this popular view might overstate the impact of higher borrowing during that episode. The author finds that once other relevant factors are taken into account, the underlying impact of the higher budget deficit on gilt yields was plausibly less than one-quarter of the actual observed increase in interest rates. He also discusses some implications of this analysis for the potential market impact of the forthcoming Budget. […]