Pound drops to 14-month low amid rising borrowing costs, global bond sell-off
Date
1/11/2025 3:32:23 AM
(MENAFN) The pound sterling has fallen to its lowest point in 14 months, trading at approximately USD1.226 during early London trading, as concerns about the UK’s borrowing costs and a global sell-off in bond markets continue to unsettle investors.
This marks sterling’s weakest performance since November 2023, driven by growing unease over UK assets as borrowing costs reach historic highs.
The UK’s 10-year borrowing costs have soared to their highest levels since 2008, while 30-year bond yields have risen to their highest point since 1998.
The sharp increase in borrowing costs has heightened concerns about the sustainability of the UK’s public finances, especially as the US dollar continues to strengthen on the global stage.
In response, Shadow Chancellor Mel Stride raised an urgent question in the House of Commons, drawing attention to the mounting pressure of higher borrowing costs on the government’s fiscal outlook. The question was directed to Chancellor Rachel Reeves but answered by Darren Jones, chief secretary to the treasury, in her absence.
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