GBP/USD Hits Lowest Level Since Late June as UK Bonds Sell Off

The British Pound has continued its downward trend, hitting its lowest level since late June against the US Dollar. The GBP/USD pair fell below 1.3200 on Thursday, as UK government bonds sold off and yields rose.

The 30-year gilt yield went above 6% for the first time since 1998, a sign of investors expecting higher inflation in the UK. This is contrary to what some experts think, with BoE external member Mann saying that financial conditions are not tight enough.

Mann's comments suggest that the BoE may raise interest rates to combat potential inflation, which could strengthen the Pound. However, markets already price in up to four rate hikes by next summer, and higher gilt yields have not helped the GBP/USD pair.