UK PLC meltdown

Yesterday's currency recap

GBP suffered a big sell-off yesterday as government borrowing costs soared, with markets re-assessing the longer term prospects of the UK economy.

The yields on 30-year gilts have surged to unprecedented heights, not seen since the notorious 2022 Autumn budget; while 10-year yields have reached peaks reminiscent of the October 2008 Great Financial Crisis.

USD gained across the board after CNN reported that President-elect Trump is considering a national economic emergency declaration to allow for a new tariff programme.

The Trump trade added to the USD gains as the currency continues to be supported on the premise that interest rates will stay higher for longer, given the continued outperformance of the US economy.

Today's GBP rates

What we think

The GBP sell-off is continuing this morning, with traders demanding a risk premium on holding UK assets considering concerns that the Government could well be close to breaching its own fiscal rules.

GBPUSD now trades at the lowest since April 2023 and GBPEUR is hitting lows last seen in November 2024. So far, the moves have been dubbed a mini repeat of the UK Plc meltdown that we saw after the Autumn Budget in 2022. Should markets remain anxious, the sell off in GBP will likely continue.

We specialise in currency guidance

Our team of currency experts are here to help you get more from your money when making international payments. We will work with you to understand your payment needs and offer specialised guidance on the best options available to you. Over the last 19 years we’ve helped over a million customers and last year alone processed over £12bn. We’re tried and trusted, and we’re ready to help you.

Have a great day.