This is precisely the assumption that critics of the government's strategy - such as Jonathan Portes at the NIESR or Paul Krugman - reject.
George Alogoskoufis, an economist at the Athens School of Economics, and Richard Portes, of the London Business School, argue that shifts in portfolios could push the euro temporarily above its long-run equilibrium level.
But, of course, if Portes is right, a rise in the cost of money for George Osborne would not be a mark of failure - because it would be a corollary of our escape from recession.
Jonathan Portes, director of the National Institute of Economic and Social Research, said there had been a long history of youth unemployment in the UK, but it had got considerably worse in the last couple of years.
The other view, perhaps expressed most eloquently by Jonathan Portes of the National Institute of Economic and Social Research, is that the government's low borrowing costs are a manifestation of the UK's economic stagnation and lousy growth prospects (see here).
Jonathan Portes, director of the National Institute of Economic and Social Research, told the BBC that people "coming from outside the UK, and especially people coming from outside the European Union, are significantly less likely than British nationals, and people born here, to claim benefits".
BBC: David Cameron talks tough over European migrants' benefits - BBC News
Now although the Portes and Osborne explanations may seem contradictory, they can both be true: investors may be lending to the Exchequer both because it seems a lot safer than lending to Italy and Spain and because there doesn't seem anywhere else terribly exciting to put their cash.
There is perhaps a more fundamental point, made this morning by Jonathan Portes of the National Institute of Economic and Social Research - which is that one of the main reasons the government can borrow more cheaply than for a century is that the economy is so weak that investors expect interest rates to remain incredibly low for years.
Portes argues that it would be good news for most of us if the interest rate paid by the government were to rise, because that would show economic growth is reviving - and the need for the Bank of England to force rates down by creating tens of billions of pounds of new money, via quantitative easing, would be over.
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