British pound extends losing streak for 6th consecutive day
Date
1/15/2025 3:04:31 AM
(MENAFN) The British pound continued its losing streak, falling for the sixth straight day amid a stronger US dollar and ongoing concerns over UK assets.
Sterling dropped 0.4 percent to USD1.2156, capping a difficult week after reaching a 14-month low of USD1.2097 on Monday.
The pound’s fall coincides with the US dollar nearing its highest level in over two years against a basket of major currencies.
Strong US economic data has reduced expectations for Federal Reserve rate cuts, bolstering demand for the dollar and pressuring other currencies.
This decline has been echoed by a turbulent week for UK government bonds, known as gilts.
Global market volatility last week triggered a sell-off in gilts, driving yields significantly higher. The yield on 30-year gilts reached its highest level since 1998, reflecting investor concerns over the UK’s economic outlook and public finances.
Moreover, the UK government sold £1 billion in inflation-linked bonds under the most expensive conditions in nearly two decades, highlighting the rising cost to taxpayers from the bond market turmoil.
The Debt Management Office (DMO) sold inflation-linked gilts maturing in 2054, with demand reaching 3.06 times the offered amount.
The UK has been among the hardest-hit markets amid a global surge in borrowing costs, driven by concerns over rising inflation in both the UK and US and declining expectations for interest rate cuts.
Market volatility has also been driven by uncertainty surrounding the economic policies of Donald Trump, who is set to assume office next week.
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