Burnham Tax Cuts Weigh on Sterling, Further Downside Expected

Sterling and UK government bonds both sold off in Thursday morning London trading, though they later stabilized as the session progressed. The moves come as Andy Burnham completes his first week as prime minister.

Market participants are reacting to Burnham's tax cut proposals, which some analysts describe as 'sugarcoating the pill.' The measures are seen as unlikely to address underlying fiscal concerns, suggesting further downside risk for the pound.

No specific figures or timelines were provided in the initial report, but the negative sentiment reflects broader uncertainty about the new administration's economic strategy.