According to a report by Ruth Gregory and Paul Dales of Capital Economics, UK government bond yields could potentially rise, and the pound might weaken if Keir Starmer or Rachel Reeves were to be replaced as Prime Minister and Chancellor of the Exchequer, respectively. They indicated that subsequent developments would hinge on the actions of the new leadership.

Starmer continues to face pressure due to his handling of the former US Ambassador, Peter Mandelson. The analysts added that if he were replaced by a team that weakens fiscal rules and commits to substantially increasing public spending and borrowing, this could trigger a significant surge in the 10-year government bond yield, potentially pushing it above 5%, and lead to a decline in the pound.

However, if the government were subsequently forced to abandon such plans, echoing the scenario of Liz Truss's "mini-budget" event, these effects might only be temporary.