James Moore: Confidence in UK could quickly evaporate

Outlook George Osborne will doubtless point to fact thatgilt yields have fallen to all-time lows as evidence that his economic medicine is working, and also point out that Italy failed to complete its latest bond auction as Hungary teetered on the brink.

The Chancellor will claim that his austerity programme has given international lenders the confidence that Great Britain plc will pay them back. The reality may be that investors simply see the UK as the best of a bad bunch.

And if the economy fails to come off the sick list, that confidence could still evaporate faster than the brandy left in the bottom of a glass.