With UK inflation heading toward 4% and no end to the Iran war in sight, a Bank of England interest-rate hike on Thursday is seen as all but a done deal. How many more Governor Andrew Bailey and his colleagues deliver is where economists and investors sharply diverge.

The euro is set for its weakest month in more than four years compared to the pound as concern about France’s outlook weighs on the common currency.

The pound’s resilience faces a test from Britain’s upcoming budget if the government’s spending restraint comes at the cost of slower economic growth.

Long-term Treasury debt fell as a rebound in global stocks reduced the appeal of haven assets, while comments from Federal Reserve Chairman Kevin Warsh did little to alter the outlook for interest rates.

France’s bond selloff may be approaching a turning point, as the surge in yields tempts some investors to wade back into the market.

The dollar neared its strongest levels this year as fiscal strains and renewed political uncertainty in Europe boosted its haven appeal, even as its run of gains stoked concerns the rally is becoming overstretched.

The Swiss franc is grabbing the spotlight as a haven against European risk after concerns about France’s debt situation hit the region’s markets.

Countries that moved fast to tackle this year’s inflation spike are finding favor with bond investors, while those that delayed may end up paying the price in higher rates.

The euro fell to its weakest level in 16 months as expectations that the Federal Reserve will further boost interest rates supported the US dollar.

The yen edged lower in New York trading after rallying earlier in the day following another warning from Japan’s currency czar about its weakness.

The dollar wrapped up its best two-week stretch in six months, a sharp reversal that Wall Street strategists say could keep the currency supported through year end.

The Swiss National Bank dialed down its threat of currency intervention as a weakening in the franc prompted it to pivot toward more vigilance on inflation.

Further intervention by Japan to prop up the yen would offer a good opportunity to sell, according to UBS Asset Management’s Kevin Zhao, who doubts Friday’s central bank rate increase signals a hawkish turn.

Currencies such as the Swedish krona and Swiss franc are emerging as prime candidates to finance carry trades as the yen’s recent surge makes it a less reliable bet than in the past.

Markets are overestimating sovereign debt risks, according to Jupiter Asset Management’s Mark Nash, who is betting long-dated bonds will rebound from their recent selloff.

Traders are boosting bets on interest-rate hikes from the European Central Bank and the Bank of England as climbing energy prices threaten to keep inflation entrenched through the coming year.

The yen strengthened nearly 2% Thursday, reversing a month of gradual decline, as traders lifted bets on Bank of Japan interest-rate hikes and remained vigilant to the risk of official action to further boost the currency.

US Treasuries fell for a second day as investors geared up for Federal Reserve Chairman Kevin Warsh’s Friday speech in Jackson Hole, where some expect him to strike a hawkish tone.

US Treasury yields edged higher for a second day as investors geared up for Federal Reserve Chairman Kevin Warsh’s Friday speech in Jackson Hole, where some expect him to strike a hawkish tone.

Currency traders are increasing hedges for further gains on the dollar ahead of a key speech from Federal Reserve Chairman Kevin Warsh at the Jackson Hole symposium on Friday.