London Daily

Focus on the big picture.
Tuesday, Apr 07, 2026

Pound Plummets to 14-Month Low Amid Concerns Over UK Borrowing Costs

FTSE 100 Index Rises Despite Weakness in Retail Stocks as Multinationals Benefit from Sterling Decline
In a tumultuous turn of events, the British pound fell to a 14-month low on Thursday, as investors expressed growing concern over the UK’s borrowing costs.

Despite the currency’s slide, the FTSE 100 index climbed to a four-week high, driven by gains in multinational companies that benefited from a weaker sterling.

By the end of the trading day, the pound had dropped 0.58% against the US dollar to $1.229 and 0.34% against the euro to €1.193.

The significant dip in sterling coincided with a drop in the yield on the UK’s 10-year government bonds, reaching lows not seen since the 2008 financial crisis.

Government officials were quick to respond, reassuring investors that there was 'no need for emergency intervention,' which helped stabilize bond yields in the afternoon.

London’s financial markets found support from the international nature of many of the companies listed on the FTSE 100, despite challenges faced by UK-centric retail stocks.

Marks & Spencer, a stalwart of the British high street, experienced a decline as it flagged uncertainty due to rising costs, even as it reported robust Christmas trading figures.

Marks & Spencer’s shares fell by 8.4% to 345.3p.

Chris Beauchamp, Chief Market Analyst at IG, noted that 'the turmoil in gilts and sterling has understandably caught everyone’s attention, but the FTSE 100 has managed another strong day today.

Sterling weakness has proven to be a boon once again, and the international nature of many of the index’s members mean there is little read-across from the doom-laden trading in UK-focused assets.' The mining sector led gains on the FTSE 100, buoyed by a global rebound in commodity prices.

Contrastingly, major European indices showed more modest movements: France’s Cac 40 rose 0.51%, while Germany’s Dax dipped marginally by 0.05%.

Trading across the Atlantic was muted, with US stock markets closed for the funeral of former President Jimmy Carter.

In other corporate updates, Tesco’s shares slipped 0.5% to 368p despite the retail giant reporting a positive festive trading period with a 3.7% increase in like-for-like sales across the UK and Ireland.

Bakery chain Greggs also faced investor disappointment, with its shares plummeting 15.8% to 2,210p after it cautioned over a 'more challenging market backdrop' ahead.

Nevertheless, the day saw positive movements for some firms.

Banknote producer De La Rue saw an 8.3% increase in its share price to 111p following a £245 million takeover approach from a British financier.

Additionally, Brent crude oil prices recovered by 1.02% to $76.94 per barrel, as traders bought into the dip following a sharp previous session decline.

The notable risers on the FTSE 100 included Anglo American, Antofagasta, Fresnillo, Compass Group, and DS Smith, while the biggest fallers were Marks & Spencer, Entain, Sainsbury’s, Centrica, and WPP.
Newsletter

Related Articles

0:00
0:00
Close
UK Denies Visa to Kanye West After Sponsors Withdraw from Wireless Festival
Trump-Era Forest Service Restructuring Leads to Closure of UK Lab Focused on Kentucky Woodland Health
Foreign Students in the UK Describe Harsh Living Conditions and Financial Pressures
Reform UK Proposes Visa Restrictions on Nations Pursuing Reparations Claims
Public Reaction Divides Over UK Decision to Bar Kanye West
Calls Grow for UK to Review US Base Access Following Concerns Over Escalating Rhetoric
UK Indicates It Will Not Permit Use of Its Bases for Potential US Strikes on Iran’s Energy Infrastructure
UK Prime Minister Defends Decision to Bar Kanye West, Questions Festival Booking
UK Accelerates Efforts to Harmonise Medical Technology Rules with United States
Wireless Festival Cancelled After Kanye West Denied Entry to the United Kingdom
Operation Europe: Trump Deploys Vance to Hungary to Save the EU
King Charles Faces Criticism From Some UK Christians Over Absence of Easter Message
Former UK Defence Secretary Raises Concerns Over Ability to Counter Iran Missile Threat
UK Signals Non-Involvement in Iran Conflict as Trump Reasserts Firm Deterrence Stance
US and UK Strengthen Medical Device Cooperation Following Tariff Removal
Trump Backs Steve Hilton for California Governor, Highlighting Reform Agenda
UK Seeks Closer Ties With Anthropic as AI Policy Divergence Emerges Across Atlantic
Experts Warn of Evolving Extremism After Teens Arrested in UK Ambulance Arson Case
UK Convenes Talks to Safeguard Shipping Through Strait of Hormuz After Conflict Escalation
Trump Highlights Strong Leadership in Critique of UK Stance on Iran
UK Authorities Review Kanye West’s Entry Status Following Festival Backlash
UK Considers Deploying Aircraft Carrier for US Independence Day Celebrations Amid Renewed Transatlantic Focus
United Kingdom Moves to Attract AI Firm Anthropic Amid Tensions with US Defense Officials
RAF Intercepts Iranian Drones in Middle East to Defend Allied Security Interests
Labour Signals Shift on Foie Gras and Fur Restrictions to Advance EU Trade Talks
Seven Arrested Near RAF Base as UK Authorities Respond to Protest Activity
Economic Pressures Mount as Analysts Warn UK Growth Is Being Constrained by Policy Burdens
UK Green Party’s Push for Church-State Separation Sparks Debate Over National Identity
Strategic Island Emerges as Growing Challenge for United States and United Kingdom Defense Planning
Pepsi Pulls Sponsorship from UK Festival Following Backlash Linked to Kanye West
Signs Emerge of Declining Enthusiasm for Social Media in the United Kingdom
Security Alert Raised Ahead of Meghan Markle’s Planned Visit to Australia
UK Food Halls Defy Hospitality Slowdown, Emerging as Bright Spot in Challenging Market
UK Sets Firm Conditions for Military Action, Insisting on Legal Mandate and Clear Strategy
UK Medicines Regulator Launches Probe into Peptide Clinics Over Health Claims
New North Sea Drilling Unlikely to Significantly Cut UK Gas Imports, Analysis Finds
Woman Linked to UK’s First All-Female Terror Plot Faces Deportation
Downed US Aircraft Over Iran Linked to Operations from UK Airfield
Two Men and Teen Detained in UK Following Attack on Jewish Charity Ambulance
UK Police Launch Inquiry After Firearms Left Unattended Outside Mayor’s Residence
Giuffre Family Calls on King Charles to Meet Epstein Survivors During US Visit
Amber Wind Warning Issued as Storm Dave Approaches Parts of the United Kingdom
Prince Harry and Meghan’s Australia Visit Set to Draw Heightened Global Attention
UK Considers Entry Fees for Overseas Visitors at Major Museums Ahead of 2026 Travel Season
UK Prime Minister and Kuwait Crown Prince Coordinate Security Response After Regional Escalation
Calls Grow to Expand Fully Paid Maternity Leave for UK Teachers Amid Workforce Pressures
UK Secures Tariff-Free Access to US Market in Landmark Pharmaceuticals Agreement
Trump Projects Strength in Critique of UK Leadership and Naval Readiness
UK FinTech Setback as VibePay and Smartlayer Cease Operations Amid Funding Pressures
UK Leads Global Coalition of Over Forty Nations to Address Strait of Hormuz Crisis
×