22 June 2026
If you are covering Keir Starmer’s resignation statement, please see the following comment from Richard Carter, head of fixed interest research at Quilter Cheviot:
“The revolving door of UK Prime Ministers is spinning once again, with Keir Starmer lasting just short of two years in the job. It is now expected that Andy Burham will be coronated by the Labour Party as its next leader and consequently as UK Prime Minister, although Starmer will continue to allow for an orderly transition. What will be interesting to watch from here is the extent that the party has a leadership contest, or whether it is considered a one-horse race and thus everyone steps aside.
“Markets are wary of Burnham’s previous policy positions so they would prefer to see ideas for governing fleshed out via a leadership contest, keeping surprises to a minimum. There are difficult decisions around welfare and defence spending lurking, with each likely to have an impact on gilts and wider UK markets. For now, given the economic team Burham has been putting in place, alongside the fact he does not appear to be seeking a new mandate, we are probably going to see more of a continuation of the current direction from the government. Cabinet appointees will likely be scrutinised, however, for their growth friendly credentials.
“Last week’s borrowing figures highlight just how messy this inheritance will be, and as such, there is unlikely to be any immediate silver bullet to the UK’s economic woes. Without that new mandate, there is likely to be more tinkering with personal taxation around the edges and as such that will weigh on growth. Gilt yields have crept up in recent days as the political picture resolves itself. With UK still at a yield premium to developed market peers, investors and markets will want to see a credible economic plan that can help ignite growth and put the public finances back onto surer footing.”
