UK yields still edging higher- GBP/USD above 1.27 again

Casting a look across at UK government bond (Gilts) just now we can see that yields are still rising. This was something touched upon yesterday and right now the 10 year yield is above 4.56%. The 30 year (not that it is relevant to the short-term market) has now risen further above 5%, currently 5.07%. So, the UK 10 year yield is now well above that offer right now in the US. Of course that might decline later this evening as well, after the Fed policy decision. The UK inflation data today has pretty much poured iced water on the prospect of a BOE cut tomorrow and that has helped the Pound to rebound over the past couple of hours. However, it is yet to make any headway past the earlier high, at 1.2723. The thing is; whilst higher UK interest rates are supportive of the currency in one way, it is not what the economy desperately needs in another. That said, it should support the Pound off the lows, even if these higher yields do not force it for another test of the 200 day moving average above 1.2800. Those higher yields are also adding pressure on the EUR/GBP. The GBP/USD is currently trading at 1.2712