The British pound is falling along with long-term British government bonds, so what are the reasons?

The pound sterling fell to its lowest level in almost a week against the US dollar, due to the decline in long-term British government bonds, due to the difficult financial situation of the UK.

The recent rise in British government bond yields was on the back of growing financial worries, with few economic events on Tuesday distracting attention from bond market movements.

This sharp increase in revenues came at a time when prime minister Keir Starmer made adjustments to his ministerial team.

This increases the pressure on Treasury Secretary Rachel Reeves, ahead of the Autumn Budget, as Reeves is expected to raise taxes in the Autumn Budget to address the deficit.

The yield on 30-year government bonds rose today to 5.697%, the highest level since 1998, according to data from the London Stock Exchange.

The outlook for the British pound is for continued declines, and any corrective rise in the pound will be a selling opportunity in the short and medium term.