Bond Markets Back Starmer Amid UK Political Risk Surge

The UK gilt market remains a quiet but critical supporter of Prime Minister Keir Starmer as leadership turmoil within his party drives sell-offs in government bonds. Every escalation in the race against his leadership has been met with higher gilt yields, pushing up borrowing costs and reflecting investor concerns over political chaos, a power vacuum, or fiscal profligacy. As of February 10, 2026, yields on the 10-year UK government bond hover near crisis highs not fully explained by the Bank of England’s benchmark. Prediction market Polymarket now gives a 25% chance Starmer will remain leader through the year and a 23% chance he will leave by month’s end, while gilt yields adjust in fits and starts rather than in lockstep with risk. Economists warn the market is in a phase of complacency and may move abruptly when political risks reach a tipping point, as seen after the 2016 Brexit referendum. With public debt high and fiscal rules seen as arbitrary, any shift toward less-disciplined leadership could spark a violent reaction, despite current support for Starmer.