The pound sterling drops to its lowest level in 14 months against the dollar.

The British pound witnessed a sharp decline against the US dollar during trading on Thursday amid widespread selling driven by the recent ongoing increases of the greenback on one hand, and the significantly exacerbated crisis in the UK treasury bond market.

In terms of trading, the pound fell by about 0.58% against the US dollar, recording $1.2296, which is the lowest level for the British currency since November 13, 2023; nearly 14 months.

The significant losses incurred by the pound came amid an increase in the yields of the UK benchmark 10-year treasury bonds to their highest level since 2008, approximately 16 years ago, just two days after the yields of longer-term treasury bonds (30-year) reached their highest level since 1998.

Although rising government bond yields generally lead to increased demand for the currency, the record high costs of British debt have raised significant concerns about the financial situation in the UK, resulting in a sharp decline in the British pound.

On the other hand, news regarding Trump's consideration of declaring a state of emergency to impose tariffs upon taking office on January 20 has significantly boosted the US dollar at the expense of other major currencies, which also increased pressure on the British pound.