Pound Sterling has lost ground by over 1% against the majority of currencies after it emerged yesterday that Government debt and borrowing costs have risen to their highest levels since 1998. This has seen bonds rise to similar levels of the infamous Lizz Truss budget and has sent markets tumbling.
Usually, rising bond yields should correlate with a stronger Pound, however due to an underwhelming economic performance in The UK since the October budget, markets and investors alike are losing confidence as to how the government plan to service these debts. This now puts an added pressure on the Spring Budget, with Chancellor Rachel Reeves likely to now consider ways in which she can cut spending, implement further tax rises and potentially even break her own borrowing limits.
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