Investors are preparing for the UK government to unleash a “cataclysmic” flood of debt sales over the next few years, leaving many asking who exactly is going to buy all the gilts — and at what price.

Even after scrapping his predecessor’s unfunded tax cuts — which triggered a bond market meltdown in September — chancellor Jeremy Hunt faces a daunting borrowing task. The cost of subsidising household energy bills, paying for creaking public services as the economy heads into recession, and servicing a ballooning interest bill from past borrowing has set the stage for a half-decade of bond sales that will dramatically expand — and permanently reshape — the ￡2tn gilt market.

The Debt Management Office — which handles bond sales on behalf of the Treasury — will need to sell an average of nearly ￡240bn of gilts for each of the next five financial years, according to Citigroup forecasts. That figure comfortably eclipses previous records, with the exception of the vast borrowing during the coronavirus pandemic.