FX.co ★ Sterling Swings Lower on Early OBR Report

The pound briefly rose to $1.31929 before retreating to approximately $1.314 after the Office for Budget Responsibility (OBR) inadvertently published critical budget figures before Chancellor Rachel Reeves's speech. The released report highlighted a fiscal buffer of £22 billion, surpassing the anticipated £15 billion, but also indicated weaker growth and elevated inflation anticipated for 2026. The premature disclosure resulted in notable market volatility, as such information is typically disclosed post-budget. The OBR outlined tax modifications, which include increased gambling duties, a levy on properties valued over £2 million, and a 2% rise in dividend taxes, projected to generate £26.1 billion in revenue by the 2029-30 fiscal year. The thresholds for income tax and national insurance contributions will remain unchanged until the 2030-31 period. The mishap concerning the early release, coupled with heightened inflation projections, prompted traders to reassess their expectations for interest rate cuts, putting pressure on both gilts and sterling. The OBR issued an apology, acknowledging that the report was made available "too early," and has initiated an investigation into the incident.