The pound and the euro have both extended their declines against a strengthening US dollar, with sterling falling to levels last seen in autumn 2023.
The pound dropped 0.76% to $1.2111, reflecting ongoing market volatility and concerns over the UK's economic outlook.
The euro also faced significant losses, sliding nearly 0.6% to $1.0185, its lowest level against the dollar since Sep. 2022.
The dollar's surge follows a robust US jobs report and receding expectations for imminent Federal Reserve interest rate cuts.
The pound's decline came on the back of a challenging week for UK government bonds, known as gilts.
A sell-off in gilts pushed yields higher, highlighting investor concerns about the UK's public finances.
The yield on the UK's 30-year bond soared to its highest level since 1998 during last week's global market turmoil.
Although bond yields for governments worldwide eased slightly on Friday, they began climbing again this morning.
US and German yields also edged higher, reflecting a persistent shift in investor sentiment and global economic uncertainty.
Shifting expectations for interest rate cuts by the Federal Reserve have fueled the dollar's rally.
The strong US labor market data released last week, the final jobs report under President Joe Biden's current administration, showed continued growth in December, reducing the likelihood of immediate rate reductions.
Similarly, expectations for rate cuts by the Bank of England have diminished.
