Institution: Political and interest rate risks in the UK may weigh on the pound

According to Golden Ten Data on June 17, Jane Foley of Rabobank stated in her report that if the Bank of England adopts a cautious stance toward rate hikes and the UK’s special election heightens political concerns, the pound may decline. Lower-than-expected UK inflation data released on Wednesday has intensified the debate over whether the Bank of England will extend its wait-and-see strategy on Thursday. If Andy Burnham wins Thursday’s special election, he may challenge Prime Minister Starmer’s leadership. Burnham’s left-leaning stance and the prospect that the fiscally conservative Chancellor Reeves may be replaced could unsettle the UK gilt market and “disrupt the pound’s movements.”