Archive · 1 Sep 2025
Sterling Slides Against Euro Amid UK Fiscal Concerns
The British pound is losing value against the euro due to worries about the UK's financial situation.
Investors are concerned about high government spending and rising interest rates.
Some experts believe that increasing taxes might actually decrease the amount of money the government collects.
The yield on long-term UK government bonds (gilts) is at its highest level since 1998.
This week, there's anticipation for announcements about the UK budget and meetings with the Bank of England, which could affect interest rate decisions.
Sterling was on track for a three-day losing streak against the euro.
Investors await U.S. economic data this week, which may affect expectations for the Federal Reserve.
The 30-year gilt yield reached its highest level since the late-1990s.
The UK's fiscal spending is at 4.4% of gross domestic product.
Parliament returns from its summer recess this week.
- Who
- Investors, analysts
- What
- Sterling fell against the euro amid fiscal concerns
- When
- September 1
- Where
- Global currency markets, United Kingdom
- Why
- Concerns over Britain's fiscal outlook and potential for higher tax rates to reduce revenue
- GBP/USD
- 1.3528
- GBP/EUR
- 86.65 pence per euro
- 30-year gilt yield
- 5.63%
- Gilt yield high
- 5.646%
- Fiscal spending
- 4.4% of GDP