Markets warn sterling slump could lead UK interest rates to triple by next year

Analysts expect Bank of England to convene meeting to raise rates with further increase in November

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The plummeting value of the pound has sent the interest rate on government debts to a 12-year high, with money markets predicting the Bank of England base rate could almost treble to 6% next year.

Sterling tumbled to an all-time low of $1.03 against the dollar overnight before recovering to $1.07 in morning trading as traders priced in forecasts of a major intervention from Threadneedle Street to support the currency.