Early Tuesday morning in Asia, The Times came out with the news suggesting that the UK government’s two-year borrowing costs have risen above 5% for the first time in 15 years amid mounting expectations that the Bank of England (BoE) will lift interest rates again this week as it battles to contain inflation.

The news also added that the Gilt yields, which move inversely to the British Pound prices, have soared in recent days as traders bet that Threadneedle Street will need to raise rates further and will keep them higher for longer than had been anticipated.

The Times also reveals the market’s expectations of witnessing a 0.25% rate hike during Thursday’s BoE announcements.

GBP/USD grinds higher

The news joins a recent US Dollar retreat to underpin the GBP/USD price recovery to 1.2800, after a two-day downtrend.

Also read: GBP/USD Price Analysis: Cable grinds higher past 1.2760 support confluence, UK inflation eyed