{"id":30023,"date":"2025-09-02T09:17:37","date_gmt":"2025-09-02T09:17:37","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=30023"},"modified":"2025-09-02T09:17:37","modified_gmt":"2025-09-02T09:17:37","slug":"sterling-slides-as-gilt-yields-hit-27-year-high","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/en-ca\/analysis\/sterling-slides-as-gilt-yields-hit-27-year-high\/","title":{"rendered":"Sterling Slides as Gilt Yields Hit 27-Year High"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"559\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/Image_fx-2025-09-02T171650265-1024x559.png\" alt=\"\" class=\"wp-image-30026\" \/><figcaption class=\"wp-element-caption\">#image_title<\/figcaption><\/figure>\n\n\n\n<p><strong>Key Points<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>GBP\/USD falls <strong>1.2%<\/strong> to <strong>$1.3422<\/strong>, weakest G10 performer against the dollar.<\/li>\n\n\n\n<li>UK 30-year gilt yields surge to <strong>5.69%<\/strong>, a 27-year high, on rising fiscal anxiety.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity is-style-dots\" \/>\n\n\n\n<p>Sterling slumped more than 1% on Tuesday, retreating to <strong>$1.3422<\/strong>, after a sharp selloff in UK government bonds pushed 30-year gilt yields to their highest level since 1998. The move highlighted renewed trader concerns about the UK\u2019s fiscal sustainability and its ability to rein in debt.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Buffeted by this year\u2019s surge in sterling and the slide in the dollar, British companies are upping their protection against foreign-exchange swings <a href=\"https:\/\/t.co\/4eufNzflJP\">https:\/\/t.co\/4eufNzflJP<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/1961335205576216834?ref_src=twsrc%5Etfw\">August 29, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>The selloff in gilts aligned with a broader repricing across global bond markets, but the scale of sterling\u2019s decline with its largest single-day fall since June has underlined Britain\u2019s vulnerability.<\/p>\n\n\n\n<p>Finance minister Rachel Reeves is expected to unveil tax increases in the autumn budget to stay aligned with fiscal targets, raising fears of slower growth.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">With the UK economy showing signs of life, most economists believe British finance minister Rachel Reeves will deliver a fiscally prudent budget, but tax rises are inevitable <a href=\"https:\/\/t.co\/Y0NzSTFrgL\">pic.twitter.com\/Y0NzSTFrgL<\/a><\/p>&mdash; Reuters (@Reuters) <a href=\"https:\/\/twitter.com\/Reuters\/status\/1961462598953832745?ref_src=twsrc%5Etfw\">August 29, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Meanwhile, Prime Minister Keir Starmer <a href=\"https:\/\/t.co\/KY07cFm9bh\" target=\"_blank\" rel=\"noopener\" title=\"\">reshuffled his cabinet this week<\/a> to bolster his government ahead of what is expected to be a challenging end to the year.<\/p>\n\n\n\n<p>Rabobank\u2019s Jane Foley warned that while a repricing of Bank of England expectations had buoyed sterling last month, fiscal risks tied to the autumn budget will remain a drag in the months ahead.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Are fears over the dollar&#39;s demise overblown? Jane Foley from Rabobank told Reuters that a lot of the factors that created pressure on the currency earlier have now been &#39;downgraded&#39; <a href=\"https:\/\/t.co\/ZAmfaYox4X\">pic.twitter.com\/ZAmfaYox4X<\/a><\/p>&mdash; Reuters (@Reuters) <a href=\"https:\/\/twitter.com\/Reuters\/status\/1950959642399351109?ref_src=twsrc%5Etfw\">July 31, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>The UK is not alone under scrutiny. France\u2019s 30-year bond yields also surged to their highest in more than 16 years this week as Prime Minister Fran\u00e7ois Bayrou sought to prevent a government collapse.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Technical Analysis<\/h2>\n\n\n\n<p>GBP\/USD has had a strong run since February\u2019s low near 1.2250, climbing steadily to reach a July high of 1.3788 before pulling back. The pair now trades around 1.3422, sitting above the key 1.3300 support zone.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/2_image-1024x450.jpg\" alt=\"\" class=\"wp-image-30024\" \/><figcaption class=\"wp-element-caption\">#image_title<\/figcaption><\/figure>\n\n\n\n<p>Moving averages (5, 10, 30) are flattening out, reflecting the consolidation phase, while the MACD has cooled and is hovering around the zero line, showing reduced momentum compared to earlier in the year.<\/p>\n\n\n\n<p>In the near term, resistance is at 1.3550\u20131.3600, with a break above opening the way back toward July\u2019s peak at 1.3788. On the downside, support lies at 1.3300, with further risk down to 1.3100 if that level breaks.<\/p>\n\n\n\n<p>For now, GBP\/USD is range-bound, with direction likely to depend on <a href=\"https:\/\/t.co\/Dup5I7oQMc\" target=\"_blank\" rel=\"noopener\" title=\"\">incoming US inflation data<\/a>, Federal Reserve guidance, and UK growth signals.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Cautious Forecast<\/h2>\n\n\n\n<p>If fiscal concerns deepen and gilt yields remain elevated, GBP\/USD could test <strong>1.3300<\/strong> in the near term.<\/p>\n\n\n\n<p>A break below this level risks extending losses toward <strong>1.3100<\/strong>, though any signs of fiscal discipline in Reeves\u2019 budget could help sterling stabilise back toward <strong>1.3550<\/strong>.<\/p>\n\n\n\n<p><strong><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/\">Create your live VT Markets account<\/a> and <a href=\"https:\/\/myaccount.vtmarkets.com\/login?_gl=1*5vyjdn*_gcl_au*Njc1MzM0NjY0LjE3NTEzNTM4MTc.*_ga*MjA5ODA0NDIzNC4xNzI3OTE1ODQ1*_ga_J26NL1ZVX7*czE3NTE4NzkxMDYkbzMwOCRnMSR0MTc1MTg3OTExOCRqNDgkbDAkaDA.*_ga_6XQ8153GYW*czE3NTE4NzkxMDgkbzU3JGcxJHQxNzUxODc5MTE4JGo1MCRsMCRoMA..*_ga_BG6LYEHPX1*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMTgkajUwJGwwJGgw*_ga_J8BRGZSREX*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_7CG6454YR5*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_69Z54R4H9N*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_CY2VCKFC3C*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjIkajQ2JGwwJGgw*_ga_TXZ07R2C21*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_17TMGY9BBE*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_MWDVVSEVL5*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_2QCC3S2748*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjUkajQzJGwwJGgw*_ga_E7D2PCX624*czE3NTE4NzkxMjYkbzUkZzAkdDE3NTE4NzkxMjYkajYwJGwwJGgw*_ga_XJ4037XKK6*czE3NTE4NzkxMjYkbzUkZzAkdDE3NTE4NzkxMjYkajYwJGwwJGgw*_ga_EJCVQDC7VT*czE3NTE4NzkxMDgkbzUkZzEkdDE3NTE4NzkxMjYkajQyJGwwJGgw\" target=\"_blank\" rel=\"noopener\" title=\"\">start trading<\/a> now.<\/strong><\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>GBP\/USD tumbles to $1.3422 after UK 30-year yields climb to 5.69%, their highest since 1998, underscoring fiscal worries. &#8211; vtmarkets.com<\/p>\n","protected":false},"author":64,"featured_media":30026,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[31],"tags":[10,58],"class_list":["post-30023","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","tag-forex","tag-pound"],"acf":{"acf_article_selection_author":""},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/30023","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/64"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=30023"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/30023\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/30026"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=30023"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=30023"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=30023"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}