GBP rises after Starmer resignation, even as the US dollar gains against the euro and the yen at the start of the week.
Sterling moved higher despite Keir Starmer’s official resignation as UK prime minister after pressure inside the Labour Party and a sharp drop in political support. However, Starmer said he had heard the message from colleagues and will stay on as caretaker prime minister until Labour picks a new leader.
A day earlier, President Donald Trump wrote on Truth Social that Starmer “will resign” and criticized his immigration and energy policies. Meanwhile, attention has shifted to the Labour leadership race, with Andy Burnham seen as a leading contender.
GBP Rises After Starmer Resignation
The pound swung up and down but stayed near its highs as markets reacted in a more positive way. Additionally, the UK FTSE 100 rose 0.50% in premarket trading, while the UK 10-year yield fell 3.4 basis points.
Elsewhere in currency trading, the dollar showed a mixed tone. It rose against the euro and the yen, but it fell against sterling.
Broader Markets Show Cautious Tone
As North American traders came in, US stocks posted modest gains. The Dow industrial average rose 189 points, the S&P gained 15.92 points, and the Nasdaq added 138 points.
Crude oil futures fell $0.60, or 0.78%. At the same time, US yields moved higher, with the two-year yield up 4.2 basis points at 4.221% and the 10-year yield up 4.3 basis points at 4.494%.
In other developments, US and Iranian negotiators ended a first round of high-level talks in Bürgenstock, Switzerland. Both sides called the talks constructive and agreed to a 60-day roadmap toward a broader peace and security agreement.
Although major gaps remain, the talks made more progress than many expected, according to the source article. Markets reacted with cautious optimism, as Gulf equities edged higher and oil prices eased on signs that both sides will keep talking.
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