British long-term borrowing costs reached a 27-year high on 2 September, causing volatility in bond markets. However, by 3 September, markets had calmed down, and the pound rose against major currencies. The selloff mainly affected long-term bonds, with 30-year gilt yields hitting 5.7%, the highest since 1998.

Concerns over the UK government’s fiscal rules intensified as debates on raising taxes or cutting spending continue. Bank of England Governor Andrew Bailey expressed doubt about future rate cuts, with the next cut not expected until April 2026. Speculation and volatility may rise as the Chancellor’s autumn statement approaches.

As bond market selloffs eased, the pound recovered slightly on 3 and 4 September. The Fed is expected to cut rates while the BoE may not do so until the second quarter of 2026. Resistance at $1.36 is key, and support at $1.335 could hold. The NFP results will impact future movements.

Yields in Britain and Japan stabilized on 4 September, with the pound gaining ground. There’s a 3.5% rate difference between the two currencies, likely to decrease. Resistance at ¥200 is strong, with ¥206 a potential long-term target. Support around ¥195.50-196.50 could provide buying opportunities.

The pound made gains as bond selloffs eased, with GBPJPY showing potential for growth. Resistance at ¥200 and support around ¥195.50-196.50 are key levels to watch. The next data releases affecting GBPJPY are British GDP and industrial production on 12 September.

Read more at Yahoo Finance: Some Recovery for the Pound as Bonds’ Selloff Eases