British Pound buckles as 30-year Gilts tops 6%, US yields soar

• GBP/USD falls 0.48% after peaking near 1.3276.
• UK 30-year Gilt yield climbs above 6% amid fiscal concerns.
• Markets see 81% odds of a November BoE rate hike.

The Pound Sterling dives over 0.48% against the US Dollar as US Treasury yields hit a 24-year high, boosting the Greenback’s appeal, while traders await the release of the Federal Reserve’s last meeting minutes. The GBP/USD trades at 1.3210 after peaking near 1.3276.

Sterling slides as surging global yields boost the Dollar ahead of Fed minutes

The UK economic docket remained absent, yet recent hawkish comments by Bank of England member Catherine Mann and its Governor Andrew Bailey, hinting at a potential adjustment to interest rates, capped Sterling losses against the Dollar.

The Bank of England has held rates unchanged throughout the year, but high energy prices have increased the chances of a November rate hike, with money markets now seeing an 81% chance.

In the meantime, borrowing costs in the UK saw the 30-year Gilt surpass the 6% mark, amid worries about France's fiscal fragility ahead of the 2027 presidential election. In Britain, the focus is on the release of the Autumn Budget on October 28 by the Finance Minister John Healey.

Global bond yields began to rise on the resumption of hostilities between the US and Iran, amid fears that energy prices would remain elevated for longer, pressuring major central banks to act. Nonetheless, the widening of credit spreads between French and German debt is sounding the alarms in the European Union for a potential spread, triggering memories of 15 years ago, during Greece’s crisis.

In the US, the economic docket featured the New York Fed Survey of Consumers, which revealed that households are less optimistic about their financial situation, and pushed higher inflation expectations for a one-year period, from 3.6% in August to 3.9% in September.

Traders shift to the Federal Reserve’s September meeting minutes, as they eye for clues about the future of interest rates in the US. The latest inflation and jobs data triggered a U-turn for the current month’s meeting, and now money markets see the US central bank keeping interest rates at the 3.75%-4% range, but for December, they expect 20 basis points of tightening, as revealed by Prime Terminal.

Ahead, the US economic schedule will feature the release of Initial Jobless Claims on October 8, followed on Friday by the University of Michigan's Consumer Confidence report.

GBP/USD Price Forecast: Technical outlook

In the daily chart, GBP/USD trades at 1.3210, keeping a bearish near-term bias as spot holds beneath the cluster of simple moving averages (SMA) around 1.3448 and the descending trend-line resistance coming in first at 1.3302 and then at 1.3426. The Relative Strength Index (14) at 36.15 stays below neutral, hinting at lingering downside pressure rather than outright oversold conditions, while Fed Sentiment Index readings near 137.91 suggest a still-firm dollar backdrop that reinforces the pair’s capped tone below these overhead technical barriers.

On the downside, initial structural support is aligned with the rising trend line from 1.3159, ahead of a deeper floor at the second upward trend-line origin around 1.3140. On the topside, a recovery would first need to clear the broken resistance trend line at 1.3302, with further upside scope only emerging if the pair advances towards and over the descending barrier at 1.3426 and the grouped daily SMAs near 1.3448.

(The technical analysis of this story was written with the help of an AI tool. Know more.)