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(Bloomberg) — British firms were already facing a global energy crunch and post-pandemic inflationary pressures. Now, market chaos following the mini-budget has pushed up borrowing costs and darkened the outlook even further.

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“Business confidence is falling at an alarming rate,” the British Chambers of Commerce said Wednesday, blaming volatility in the markets for exacerbating the situation.

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“The government must rapidly provide more detail on its fiscal policies and supply side reforms, particularly at a time when businesses face the twin crises of rising interest rates and high inflation,” it added.

Chancellor of the Exchequer Kwasi Kwarteng revealed a series of unfunded tax cuts during the mini-budget on Sept. 23, without getting the plans independently assessed by the UK’s Office for Budget Responsibility. Gilts plummeted and the Bank of England is now struggling to end its support for the market without prompting another rout.

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Kwarteng later scrapped a tax cut for the country’s highest earners and brought forward publication of his fiscal strategy to Oct. 31, which will come with OBR forecasts. Markets have not settled, though, with borrowing and refinancing costs remaining elevated.

An index that tracks high-grade sterling corporate debt has risen 1.4 percentage points since the mini-budget was announced, extending the biggest annual increase since the index’s inception in 1999. It would now cost a company £3.5 million a year for every £100 million of debt it refinances.

While many large companies have fixed debt costs, the BOE’s Financial Policy Committee said Wednesday that small businesses were vulnerable as most depend on bank loans with floating rates. These firms pose only a “limited direct risk” to the financial sector, yet they employ a significant number of people and the BOE warned of businesses going bust amid weak demand and higher credit costs.

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“The share of businesses with low interest coverage ratios is expected to increase materially,” the BOE’s Financial Policy Summary said, albeit remaining below historical peaks.

Read More: UK Recession Risk Rises With Surprise Drop in August Output

Following more than a decade of easy money, “suddenly businesses are facing a completely different environment as soaring borrowing costs ratchet up the price of debt,” said Julie Palmer, partner at insolvency specialist Begbies Traynor.

High interest rates are “rapidly becoming the number one concern for many businesses,” overtaking energy costs, Palmer added, after the government announced a six-month cap on energy prices for companies and charities. Swathes of so-called zombie companies could be wiped out once years of low debt costs come to an end.

“We’re also hearing stories about ‘director fatigue’ — company bosses who are finally giving up after fighting on for so long and just can’t face any more problems after two horrendous years,” she said.