The Pound flatlines as Treasury yields climb to another high

• GBP/USD flatlines above 1.3200 as the US 10-year yield hits its highest since 2002.
• The Pound trades near its strongest level of 2026 against the Euro.
• No UK data through Friday, just three Bank of England speeches.

The odds of an October Fed hike have fallen from about two in three in late September to roughly one in five, and GBP/USD hasn't left the range it has traded in since September 24. Monday's range is entirely inside Friday's, and the pair trades just above 1.3200.

Rising long-term Treasury yields are holding the Dollar up now that Friday's weak jobs report has cut Fed hike bets. The 10-year yield touched 5.35% on Monday, its highest since April 2002. The Institute for Supply Management (ISM) services index came in a tenth under forecast, but its prices component rose to 74. The UK's Bank Rate was 4% the last time the 10-year paid this much, about where traders expect it after the next Bank of England (BoE) decision.

Bought against the Euro, stuck against the Dollar

France's bond selloff has made British assets look like the safer European bet, and the Pound trades near its strongest level of 2026 against the Euro. The Pound's strength against the Euro kept GBP/USD above its lows on Monday, when EUR/USD made a new one, and explains much of why the pair's range has held for eight sessions. Investors picked British assets as the safe option in the same week the 30-year gilt yield touched 6%.

No UK releases, so the Pound's biggest event is a Fed document

The UK calendar has no data through Friday, only speeches. BoE external member Mann speaks on Tuesday at 08:40 GMT, followed on Thursday by external member Greene at 09:15 GMT and Deputy Governor Lombardelli at 13:00 GMT. External members Mann and Greene both voted to raise the Bank Rate on September 17, and traders already price most of a quarter-point hike for November 5.

Wednesday's Federal Open Market Committee (FOMC) minutes, due at 18:00 GMT, cover the September 16 hike. Minutes that show officials leaning toward another hike would add Fed support to the bond yields already under the Dollar, the likeliest route to a break below GBP/USD's range. Chancellor Healey presents his first budget on October 28, the same day the Fed decides.

Levels around the Pound's range

Resistance: 1.3250 has capped every daily close since September 30, and Friday's and Monday's highs both stopped at or just above it. 1.3300 is the top of the range, where the September 30 spike ended.

Support: Three straight sessions have bottomed just under 1.3200, the lowest levels since late June. 1.3150 is next, then 1.3100.

Bias: The lean stays short while 1.3250 caps on a closing basis, with 1.3150 the first objective and 1.3100 the second. The daily Stochastic Relative Strength Index (Stoch RSI) has turned up from the bottom of its range to near 14, so a run at 1.3250 may come before the break lower. A daily close above 1.3300 ends the call.

GBP/USD daily chart