GBP hit by fiscal worries
The British pound slumped overnight as surging UK bond yields sparked fresh concern across Europe.
The benchmark UK 10-year yield jumped to 4.82% — just 10 basis points shy of its highest level since the global financial crisis. The 30-year yield hit its highest mark since 1998.
Mounting deficit pressures are raising tough questions about how Chancellor Rachel Reeves will balance the books. If the bond sell-off deepens, she may be forced to offer clarity well before the autumn budget, typically unveiled in late October. With internal party tensions rising, new tax hikes or spending cuts may be unavoidable.
The GBP/USD led losses with the pair down 1.1%.
The AUD/GBP hit one-month highs and GBP/SGD hit one-month lows.
The GBP/USD moves saw the USD mostly stronger in other markets. The AUDUSD fell 0.5% while USD/SGD gained 0.3%
EUR/SGD retreats from highs as Bayrou warns of possible collapse
French Prime Minister, François Bayrou warned that his government faces a real risk of collapse, admitting that ongoing parliamentary talks may not be enough to hold it together.
Despite the uncertainty, Bayrou is pressing ahead, working to rally support ahead of the crucial confidence vote on September 8.
EUR/SGD is holding just above short-term support near the 21-day EMA of 1.4980, with a secondary floor at the 50-day EMA of 1.4933. The pair is trading 0.5% below its April peak.
The next hurdle for EUR/SGD is the April high of 1.5113.
USD/SGD remains quiet, with resistance seen near the 100-day EMA of 1.2933.
USD/JPY steadies as Japan braces for political shake-up
Japan’s ruling Liberal Democratic Party will release its post-election review on Tuesday, following recent upper house losses.
The findings could stir fresh uncertainty around Prime Minister Ishiba’s leadership and open the door to challengers like Takaishi, whose support for Modern Monetary Theory has raised investor concerns.
Meanwhile, the US–Japan trade deal remains unresolved, and shifting travel plans from chief negotiator Akazawa are adding to the tension.
USD/JPY is holding just above short-term support near the 21-day EMA of 147.46.
GBP pounded
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 31 August – 5 September
All times AEST
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*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.
