The British Pound weakened to 1.32 against the US dollar on Monday, June 22, 2026, as political uncertainty gripped the United Kingdom following Prime Minister Keir Starmer's resignation announcement. The currency has declined by over 1.65% against the dollar in the last five days, driven by both domestic political turmoil and a strengthening US dollar.
Pound Under Pressure Amid Political Turmoil
In the opening session of the UK forex market, the pound sterling traded at 1.32 against the greenback at the time of filing this report. The currency's slide reflects growing investor anxiety as Starmer's departure creates a leadership vacuum. Currency expert K N Dey told ANI that the weakness was fueled by two key factors: the dollar index rising above 101, which pressured most currencies, and the UK's political uncertainty adding extra negativity to the pound.
"First of all, the dollar index is above 101. In fact, the dollar index went up last week, which has made the other currencies to come down. So sterling also has come down. And second thing is that there is a political uncertainty in UK. That is also adding a little bit of negativity on the sterling. So sterling is rather down more than the required," Dey said.
Starmer's Resignation and Internal Party Pressure
Starmer's resignation came after weeks of mounting pressure from within his own Labour Party. The situation escalated sharply when Labour Party rival Andy Burnham won a parliamentary seat on Friday, a victory that could enable him to mount a formal leadership challenge. Despite leading Labour to a landslide victory in the 2024 general election, Starmer faced growing internal dissent over controversies and policy reversals that critics say eroded public confidence.
According to reports, more than 100 Labour MPs—approximately a quarter of the party's parliamentary strength—publicly called on Starmer either to resign or provide a clear timeline for his departure. This internal rebellion has added to the political uncertainty, with investors closely watching the leadership situation in the UK.
Market Outlook and Expert Analysis
Dey noted that the pound could continue to face pressure until the political situation stabilizes. "And going forward, until and unless this political uncertainty in UK gets settled, the sterling will have pressures going ahead," he said. Market participants are expected to monitor developments closely, as prolonged uncertainty could keep the pound under pressure in the near term.
Trump Weighs In
US President Donald Trump on Sunday claimed that Starmer's resignation was due to failures in immigration and energy policy. "Keir Starmer will resign as Prime Minister of the United Kingdom," Trump stated on his social media platform, Truth Social. "He failed badly on two very important subjects - IMMIGRATION AND ENERGY (OPEN NORTH SEA OIL!). I wish him well!" Trump remarked.
The political developments have added to uncertainty in financial markets, with investors closely watching the leadership situation in the UK. The pound's weakness reflects broader concerns about the country's economic direction and political stability.
