UK sterling hits a 3-month high on a trade-weighted basis; Bank Rate holds at 3.75%
The pound's trade-weighted index, which measures sterling against a basket of trading partners' currencies, rose to 86.04 on 21 October. That is its highest since mid-July. Bank Rate stayed at 3.75%.
A data update from FactIQ, written from UK official statistics (ONS, Bank of England, DEFRA, HMRC, DBT, and DfT) figures. What is FactIQ?
Key figures
- Sterling effective exchange rate index (pound against a basket of currencies), 21 October
- 86.04up from 85.16 a week earlier; highest since 86.17 on 16 July2026-08-142026-10-21Effective exchange rate index - Sterling (Jan 2005 = 100)
- Euros per pound, 21 October
- 1.1924up from 1.1617 on 25 September; highest in data going back to early May2026-08-142026-10-21Spot exchange rate - Euro into Sterling
- UK 10-year government bond par yield, 20 October
- 5.35%down from 5.37%; started January near 4.40%2026-08-132026-10-20Yield from British Government Securities - 10 year Nominal Par Yield
- Bank of England Official Bank Rate, 21 October
- 3.75%unchanged2026-08-142026-10-21Official Bank Rate
The pound has strengthened against the euro and the dollar
The Bank of England's sterling effective exchange rate index rose to 86.04 on 21 October. A week earlier it stood at 85.16. Its last higher reading was 86.17 on 16 July.
- Euro per pound: 1.1924 on 21 October, up from 1.1617 on 25 September. This is the highest reading in the data available, which go back to early May.
- Dollars per pound: 1.3384, little changed on the day but up from 1.3160 on 14 October.
- Yen per pound: 211.61.
UK government bond yields slipped on 20 October but remain well above January levels
Gilts are UK government bonds. A par yield is the yield on a bond priced at its face value. The latest yields are for 20 October, the day before the September consumer price index (CPI) inflation figures came out. They therefore do not show any market reaction to that data.
- 10-year par yield: 5.35%, down from 5.37%. It started January near 4.40%, so it is still about 95 basis points (hundredths of a percentage point) higher this year.
- 5-year: 4.96%, down from 4.97%.
- 20-year: 5.67%, down from 5.71%, a fall of about 4 basis points.
Policy rates were unchanged
Official Bank Rate, the Bank of England's main interest rate, was 3.75% through 21 October. The Sterling Overnight Index Average (SONIA), the average interest rate banks pay to borrow sterling overnight, was 3.734% on 20 October. The 10-year yield is about 160 basis points above Bank Rate. That gap suggests markets are pricing in tighter policy, a term premium (extra return investors demand for holding longer-dated bonds), or both. This comes ahead of the Budget and the Bank of England's next meeting.
Source: UK official statistics (ONS, Bank of England, DEFRA, HMRC, DBT, and DfT). See all UK data in FactIQ.
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