Sterling Holds Below Four-Year High Amid UK Political Uncertainty

2026-02-10 09:04 By Joana Ferreira 1 min. read

The British pound traded near $1.365, remaining below the late-January peak of $1.387, its strongest level in more than four years, as investors assessed fresh political developments in the UK.

Sterling came under pressure after Prime Minister Keir Starmer’s chief of staff, Morgan McSweeney, resigned amid the Lord Peter Mandelson scandal, fueling speculation about Starmer’s leadership.

Tensions escalated when Scottish Labour leader Anas Sarwar publicly called for the prime minister to step down.

However, support from cabinet members and across the Labour Party helped steady sentiment, suggesting Starmer has, at least for now, weathered the challenge.

At the same time, rising expectations of further Bank of England rate cuts have weighed on the currency.

Although the central bank left its benchmark rate unchanged at 3.75% in a split decision, policymakers struck a more dovish tone than expected, indicating that CPI inflation is likely to return toward the 2% target from April.



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